All Forum Posts by: Todd Crippen

@Luther Wilson III, I appreciate the specification, and know you were just starting a dialogue by asking for a response, which is a great way to make sure people consider all factors when getting started. As far as the whole process from start, finish, and in between being provided at a premium, I also do not think that is the case for good turnkey providers. Turnkey providers should have a system in place to allow for modest revenue generation and developing relationships with contractors/vendors to provide those services at their cost with a small administrative fee. The services should be to help maximize cash-flow and minimize associated fees to increase a repeat client pool. As always, not all providers have that capability but I think it’s important to partner with one that does. I also agree that good deals can be hard to find, but Kansas City remains one of the best markets for rental properties according to Forbes magazine. Good providers spend a lot of time developing relationships with a number of professionals, from wholesalers to agents, to facilitate their inventory stream at a price that allows for them to make money while providing a solid investment for clients. But like you said, it can be difficult. I agree with you.

@Lu Chen, thank you for visiting our website. We are not affiliated with roof stock directly, but we met a representative and wanted to try out the platform. 

The majority of our properties are tenanted by the time they are closed, but it just depends on what stage we are in when our clients choose a property. Regardless, the first lease up fee is on us and we market it until a tenant is placed.

You bring up multiple great questions. I believe that it is combination of decade and renovation quality. You want to try and avoid stone foundations unless they have been very well maintained. Anything before the late ‘40s would require more due diligence in my opinion. As long the property has been properly renovated and has a sound foundation, anything built in the 50s and newer has good potential for the long-term investor. 

Also, it is very important that a turnkey provider has a standard renovation approach focused on capex items that commonly lead to deferred maintenance costs (roof, hvac, plumbing, electrical). For example, at Turnkey Property Group, we hire a third party licensed inspector to give us his professional opinion on the remaining lifespan, and if at least ten years isn’t their opinion, it is immediately replaced. 

Neighborhood class is another factor that is important when choosing a turnkey provider. It’s important to trust the company you choose to work with and be able to comfortably rely that they have researched areas of growth potential that have a rental demand/tenant quality.

As long as the property is well maintained in a market with high rental demand, it should have similar avg days on the market. I think B- to B+ areas are best. If you are wanting multi-family, I think it’s beneficial to start with B+ as the minimum threshold.

We have been lucky with our tenants staying. We have experienced a couple of early lease terminations, but the lease up fee is taken out of their deposit.

Turnkey Property Group provides solid cash-flowing properties with premium property management services. We invest alongside our clients, and only provide properties we would add to our personal portfolio. This property is located next to Hillcrest Golf Club.

@Luther Wilson III, I understand the hesitation when deciding whether or not to go the turnkey route, but I think there are a lot of factors that an investor needs to weigh during the decision making process. Turnkey investing is very dependent on the market the companies are located, level of involvement desired, policies of the companies, pricing, warranties, and whether they have in-house property management. 

For example, the seasoned turnkey companies realize that their demand is driven by investors looking for a safe, consistent return. That means that the market needs to provide the opportunities for turnkey companies to price their properties based on the rent to value ratio, instead of relying on top market price, they are providing those properties below market value a lot of the time. If you can cash-flow $200-$350/month, with 20% down, that is a solid long-term investment.

Also, the turnkey option is the best way to go if you would like the benefits of owning rental property without being completely hands on. At our company we like our clients to be involved as much as they want to be with the expectation of trust in our expertise for certain operational factors.

Also, if the turnkey company has well-established policies in place for leasing, resident on-boarding, standardization of renovation approach (replacing capex items first and foremost), and property management, then they could be a good option for investors.

Also, look to see if they have warranties in place to cover the renovations they have completed on the property. This is a good way for turnkey companies to hold themselves accountable for their work. If they do not cover any of the items on the scopes of work completed, then it could mean the company does not focus on quality. 

Also, it's my opinion that if the company provides in-house property management services, that is another way they hold themselves accountable. There are mixed reviews on whether this is a positive or a negative, but if the other factors have been met, this is another great sign you've found a company dedicated to providing a quality product and resident to manage.

Also, even though some of the prices look like there is a premium in price point, you have to find the value in the services being provided: Extensive research in the submarkets in their city, leasing services, value add to the property, and property management. 

I hope this helps start the convincing process. Feel free to ask me any questions!

Robin,

I agree with @Chris Clothier about there being opportunities in California with similar price-points and returns as the midwest, and do encourage seeking them out. I also agree @Brandon Sturgill that @Chris Clothier runs a very impressive turnkey operation! 

I also think it is important to consider the amount of time you're wanting to invest in the search and the realistic inventory availability to find these opportunities in comparison to the midwest. 

If you have the time available to acquire, manage (or hire a third party) a renovation, locally or elsewhere, than it can definitely be rewarded. But, if you are wanting to go the more passive route, vetting a quality turnkey provider that prices at a rent to value ratio, which tends to be lower than market value, in sub-markets with growth catalysts can be a very solid route to consider. In my opinion, it is just simply easier to find safe and consistent opportunities in certain sub-markets of larger metropolitan areas in the midwest.

I have clients that have had success in Memphis, Indianapolis, Jacksonville, and Kansas City (where our firm serves OOS investors). Kansas City has a highly diverse job market and covers two states, all while staying right around the 1% rent to value price point. 

Please feel free to reach out if you would like any more advice or to share strategies!

Great opportunity to add a solid door to your portfolio. We also have one around the corner available. Please click here for more details.

One of the most rewarding aspects of my job is speaking with investors about how to generate rental income from a tangible asset without requiring active involvement.

A lot of people are familiar with the turnkey process, but it is a new concept for a lot of investors just starting out. I want to invite BP users to ask questions about the turnkey strategy, and what the most important factors are when choosing the right company to partner with. What are the main questions people have when deciding to invest with a turnkey company? What is are the biggest concerns? 

What are the most important factors investors consider before choosing the right turnkey market? Kansas City, Indianapolis, Memphis, Jacksonville, Dallas. How do you choose? Please ask me any questions.

Completely renovated and sold with management in place. Turnkey Property Group would love to be your pass income partner. For more information, click this link.

This property has a great tenant moving in on October 1st! Completely remodeled and provided by Turnkey Property Group. Our properties are carefully chosen, remodeled, leased, and sold to our clients with management conveniently in place. For more information follow this link.

Just marketed for lease with an application under review! Expected to be leased by October 1st. Don't miss out on this great investment!

More details here!