{"id":86812,"date":"2017-04-02T05:00:35","date_gmt":"2017-04-02T11:00:35","guid":{"rendered":"https:\/\/www.biggerpockets.com\/renewsblog\/?p=86812"},"modified":"2021-03-16T12:22:07","modified_gmt":"2021-03-16T18:22:07","slug":"turnkey-operators","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/turnkey-operators","title":{"rendered":"5 Steps to Weed Out Shady Turnkey Operators"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Today, we\u2019re going to talk about investment strategies for retired people. <\/span><\/p>\n<p>In my mind, it\u2019s very clear where you should be investing your money\u2014real estate. Forget about CDs, forget about stocks. Put your money in real estate.<\/p>\n<p>Why? Because you are the master of your fate, you are the captain of your soul, you are the board of directors of every transaction you make, you are the CEO controlling every transaction.<\/p>\n<p><span style=\"font-weight: 400;\">What I mean by that is that if you invest in stocks, you have one vote out of tens of thousands of stockholders. Ultimately, it\u2019s the board of directors and the CEO who decide which direction that company will\u00a0take. So, your fate is in the hands of someone else.<\/span><br \/>\n<em><br \/>\n<strong>Related:<\/strong> <a href=\"\/renewsblog\/turnkeys-for-newbies\" target=\"_blank\">Why Turnkey Rentals Might Just Be an Ideal Investment for Real Estate Newbies<\/a><\/em><\/p>\n<p><span style=\"font-weight: 400;\">Don\u2019t even consider CDs! If you want to get 0.5% return on your investment when inflation is 3\u00a0to 4%\u00a0so you\u2019re actually losing money, that\u2019s the most ridiculous thing I\u2019ve ever heard. Forget about it!<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In my opinion,<\/span> turnkey real estate is where you need to park your retirement money via a self-directed IRA or your savings that you have built-up over the last 30\u201340 years. Why do I suggest turnkey real estate investing? You are at a point in your life where you don\u2019t want more stress, you don\u2019t want any more drama. You don\u2019t want to be dealing with contractors, real estate agents, property managers, accountants, attorneys, or title companies. You should be playing tennis\u00a0and golf or sipping pina coladas in Florida, where it\u2019s really warm and the weather is awesome. Turnkey real estate offers <span style=\"font-weight: 400;\">that. Still, beware because there are many shady turnkey operators.<\/span><br \/>\n<iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/Jk50ZyCsCRI?ecver=1\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>5\u00a0Steps to Weed Out Shady Turnkey Operators<\/h2>\n<h3>1. Google the company name.<\/h3>\n<p><span style=\"font-weight: 400;\">When you type in the company name p<\/span>ut &#8220;scam&#8221; be<span style=\"font-weight: 400;\">hind it. The first several pages of Google will reveal any scams. Also type in the owner\u2019s name and &#8220;scam&#8221; behind it.<\/span><\/p>\n<h3>2. Find out if they have in-house property management.<\/h3>\n<p><span style=\"font-weight: 400;\">Make sure they own or control the property management. If it\u2019s not controlled and owned by the turnkey company, they have a super tight relationship and proven track record so that you can get better pricing than just anyone off the street.<\/span><\/p>\n<h3>3. Evaluate the turnkey operator\u2019s demographic focus.<\/h3>\n<p><span style=\"font-weight: 400;\">Experience has led me to believe that<\/span> B-class properties in B-class areas offer the best investment opportunity. These are areas that are 50% investor-owned and 50% owner-occupied. Before the global financial crisis, it was predominately owner-occupied. Then smart investors began buying and renovating in these areas, renting to the same folks who used to live in the area.<\/p>\n<p><em><strong>Related:<\/strong> <a href=\"\/renewsblog\/find-a-turnkey\" target=\"_blank\">Your Complete Guide to Finding a Profitable, Well-Managed Turnkey Deal [With Example Pro Forma!]<\/a><\/em><\/p>\n<p><span style=\"font-weight: 400;\">These people chose to stay in the area because of the infrastructure nearby\u2014a hospital, a school, a mall, or a factory. So, there is a level of desirability that drives the demand of tenants and homeowners. These areas are well-kept and have great curb-appeal, with no boarded-up properties and low crime rates. The typical age of the property doesn\u2019t really matter as much as the other things I mentioned.<\/span><\/p>\n<h3>4. Look at the quality of workmanship.<\/h3>\n<p><span style=\"font-weight: 400;\">You need to understand the type of products the turnkey company is buying and how well they are renovating the property. Don\u2019t expect to get the Taj Mahal. It needs to be very clean, efficient, and sustainable for the long haul. So, make sure the plumbing and electrical are in good working order. The roof needs to have a good lifespan left.<\/span><\/p>\n<h3>5. Check reviews.<\/h3>\n<p><span style=\"font-weight: 400;\">You need to speak to other investors who have bought from the turnkey companies. You need to look for testimonials. Really get inquisitive because past performance and history is a very good indication of future performance and what the future holds.<\/span><\/p>\n<p><em>Any other tips you&#8217;d add to this list?<\/em><\/p>\n<p><strong>Let me know with a comment!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Want to be sipping pina coladas in Florida? Turnkey real estate can offer that lifestyle. Still, beware because there are many shady turnkey operators.<\/p>\n","protected":false},"author":1672,"featured_media":87429,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5524],"tags":[],"class_list":["post-86812","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-investing-for-beginners"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/86812","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/1672"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=86812"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/86812\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/87429"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=86812"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=86812"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=86812"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}