All Forum Posts by: Kevin Charles

One concern I have, is TKPs doing their own property management.  Seems like it  can set the investor up due to conflict of interest.  If there are problems it could be easy to hide it from the investor.  The PM is the same company that did the rehab and found the tenant, if they made mistakes in those areas what's to prevent the PM from hiding it from the investors.

Convince me I'm wrong.   

Hey @Kevin Charles have you considered investing in REITs or through online real estate investing platforms? Less of a hassle and much less expensive.

Of course, OOS investing always ads another level of risk/complication, in that you can't just drive by and make sure your property is being maintained, etc. This is why your research and vetting is so crucial. Whether you go turnkey or build a team of your own (agent, contractor, PM etc) and manage that team from a distance, you are going to be physically removed from your investment, so vetting your partners is huge. I usually suggest that new investors, or any investor moving into a new market/working with a new team, do the legwork of finding the best 1 or 2 options and then fly out to meet those people. Even with all the reviews and testimonials available on the web, looking people in the eye is still the best way to gut-check your decisions. Schedule a visit, look at the neighborhoods, tour some of the properties they've rehabbed before, ask questions.

Many of our clients are people who would like to be more hands-on eventually but don't have the experience or knowledge or time to go the DIY route. Turnkey can be a good way to get your capital working while you take more time to learn the ropes. And you don't have to stick with one investment niche forever. Many of our clients have portfolios that include both types of investment, starting with turnkey and moving into BRRRR once they have a firm footing. Even if the BRRRR learning curve is steep and the first deal doesn't go perfectly, they still have cash flow from their turnkey investments as a little safety net. Diversification is rarely a bad thing.

My advice would be to take some time to really hone in on your goals, needs, and expectations with regard to the tradeoffs I mentioned and let those answers point you in the right direction. Is time your most limited asset, or can you invest that energy in learning as you go? Is your primary goal to maximize your return at any cost, or are you willing to keep cash flow but sacrifice forced appreciation in exchange for a more hands-off investment? If you have a partner or spouse, make sure to include them in that convo - not being on the same page when you begin investing is a great way to have troubles down the line. 

If you have any questions about the turnkey model or the Birmingham market, or anything I've said here, feel free to tag or PM me any time.

Best of luck!

Clayton