All Forum Posts by: Steve Donovan

@Jayden Hamilton  As others have stated, there are benefits to both single family and multi unit properties.  Multi family allows you some built in diversification, if one unit is not performing due to vacancy or tenant issues, you are still receiving income from the other.  When you choose to sell your investment, single family gives you better options; you can either sell to another investor or sell to a homeowner.  Multi family units will only be sold to other investors.  Best of luck to you in your investing future!

Hi @Jason Dubien  I think you should involve the lender in this.  As stated, the bank made the loan based on an appraisal assuming work that was never completed.  They may have some suggestions for you on how to proceed against the turnkey provider.  If the lender finances properties for this turnkey provider on a regular basis, they may have some leverage with the provider by not financing their projects in the future.  This is a very compelling example of why you should not close on a turnkey property until all the work has been completed.  The promised scope of work can then be verified by an inspection.  Best of luck to you in this situation as well as your other investments!

Hello @Srikanth Raj  I think first off you should determine what you are looking for in a turnkey property as there is a vast difference in what is offered from one turnkey provider to another.  

In terms of rehabbing the property, the workflow can range from throwing a coat of paint on a wall or two, to an entire gut of the mechanicals, windows, siding, and flooring. Some providers take the approach that a furnace or water heater with several years of expected life shouldn't be replaced in the rehab, but that the final product should be priced accordingly. That furnace will need to be replaced in the next few years, but just not yet... Any turnkey investor should ask very probing questions of the turnkey provider regarding the condition of all mechanicals, roof and windows prior to entering into a deal. There is nothing wrong with either approach (full rehab vs targeted based on immediate need), but it is important to know which level of rehab has been done on a unit you are considering purchasing.  You will find that there is no common definition of a turnkey property, and it can be very risky (and expensive) to make any assumptions.

The ongoing management of the property is another area of vastly different approaches to turnkey investments. Some providers simply sell the property and the investor is left to find a management company, maintenance personnel, snow and lawn care providers, etc. Other providers offer up recommendations for these services, and still other turnkey companies offer these services as part of their overall package. The range of offerings is great, and no assumptions should be made; you need to ask very specific questions regarding who is to do what.

Make sure you check references, and contact other clients that are located remotely to determine if the communication and follow up is adequate.

Best of luck to you with your investments!

Welcome to the investment community @Dylan Prout! In addition to the very great advice from the other posters on this thread, I'd suggest you attend a meeting or two of your local REIA. WiscoReia has meetings in various locations around the state. You can find them at ww.wiscoreia.com Then click on locations to find the one nearest to you. I've attended meetings at the Green Bay and Appleton locations and they offer great content and very engaged membership. Best of luck as you get started. If you are in the Green Bay Fox River Valley area, feel free to reach out!

Congratulation @Brandon Rush on a great deal!!

Congrats @Amanda Belonger!  Sounds like a great deal that didn't have too many hiccups along the way?  How long did the project take from the purchase date until the sale date?

Hi again @Matt Slease.  I'm sorry, I didn't realize that there was already a lease in place on your newly acquired property.  The lease transfers to you and will be in force until it's expiration.  Make sure to review it and ensure that you, and the tenant abide by its terms.  If there is another adult living in the property, I would make sure that she is added to the lease as well.  You'll want to check the tenancy laws in Ohio or wherever this rental property is located.  Again, best of luck in your investing future!

Hello @Matt Slease.  Congrats on your first purchase and best of luck to you in getting into many more.  I have purchased several properties with inherited tenants and honestly the amount of rent is secondary to making sure your expectations are clearly understood by the tenant(s).  Have the new tenants sign your lease as soon as possible and make sure that your expectations are contained within the lease.  Who is responsible for lawn care and snow (if applicable)?  Who is responsible for routing maintenance such as changing furnace filters, water softener salt, etc?  Are all adults currently living in the unit on the lease or are people living there that are not?  What are your thoughts on pets; are they allowed at all, and if so, is there an additional cost?  Get the new tenant to sign a lease, even if only month to month so you can get comfortable with him if that is your choice.  Again, best of luck to  you!

Hello @Matt Slease.  Congrats on your first purchase and best of luck to you in getting into many more.  I have purchased several properties with inherited tenants and honestly the amount of rent is secondary to making sure your expectations are clearly understood by the tenant(s).  Have the new tenants sign your lease as soon as possible and make sure that your expectations are contained within the lease.  Who is responsible for lawn care and snow (if applicable)?  Who is responsible for routing maintenance such as changing furnace filters, water softener salt, etc?  Are all adults currently living in the unit on the lease or are people living there that are not?  What are your thoughts on pets; are they allowed at all, and if so, is there an additional cost?  Get the new tenant to sign a lease, even if only month to month so you can get comfortable with him if that is your choice.  Again, best of luck to  you!

Hi @Matthew Laws and welcome to BP. Good for you to discover the local REIA, it's full of like minded people and offers education and inspiration. I hope I see you at one of the upcoming meetings. Feel free to reach out if you have questions. Best of luck to you!