Now that you\u2019ve decided turnkeys might be the right route for you (because if they weren\u2019t, I assume you wouldn\u2019t still be reading), why might they be good for you if you are a new investor?<\/p>\n
Turnkeys let you learn the fundamentals of rental property investing without the pressure of figuring out the more complicated, riskier aspects of rental property investing.<\/em><\/p>\n What does that mean?<\/p>\n Well, think about it. Let\u2019s say you want to find a distressed property and rehab it and then rent it out. This is\u00a0an extremely common strategy because it allows you to value-add and have quickly added equity in the property, which is essentially cash in your pocket. Makes sense to me! But what things do you need to master\u00a0in order to do this kind of investment successfully?<\/p>\n I’m not sure about you, but to me, this is no small list of potatoes. Do you know how to do all of these things, if you are pondering rehabbing or the BRRRR method<\/a> for buying rental properties? And I don\u2019t mean the basic gist of each; I mean getting a handle on the ins and outs of exactly how to do each one and how to do it well and mitigate risk in each.<\/p>\n If you are missing the boat on even half of one of these tasks, you could sink your investment.<\/p>\n I think if you have the skills for all of this, like I said, you should absolutely go for it. But as a new investor, do you have these skills? Again, they are no small potatoes.<\/p>\n Which of these skills do turnkeys eliminate for you?<\/p>\n Can you even see in there what is left over for you to need expertise in after turnkeys help out with the majority of stuff?\u00a0Numbers and due diligence.<\/em><\/p>\n For a list of 10 to get shrunk down to a list of two\u2014that\u2019s pretty serious. And on top of that, those eight things that turnkeys eliminate for you are much more complicated to learn and have expertise in than numbers and due diligence.<\/p>\n Numbers are pretty easy to learn. And once you\u2019ve learned them, you can whip them up pretty quickly on any property you look at. For help on learning the numbers on rental properties, check out “Rental Property Numbers So Easy You Can Calculate Them on a Napkin<\/a>.”<\/p>\n Due diligence in more thorough, and this is where you are going to learn a lot\u00a0as a new rental property investor. You are going to verify market fundamentals (note: here you only have to learn how to verify if a market is good, whereas the initial list of DIY tasks requires you to do much more than just verify), run and verify numbers, verify rentability and advertised quality of the investment, follow along with property inspections to verify the quality of the rehab, verify the tenants, and verify the quality of the property management set up to manage the property for you.<\/p>\n Do you see a common word in that list? Verify. <\/em>That is the most of what you are doing with turnkeys.<\/p>\n Learning what things you need to verify and then verifying them, will teach you the most basic (and crucial) fundamentals there are for rental properties.<\/p>\n Verifying all of the things involved with the property is very different than having to do all of those things yourself. You will learn what needs to be done for each component (which can be used later if you decide to DIY), and all the while, the turnkey seller is holding the risk\u2014not you. If you do everything yourself, you are the one whose money is in the pot while you are trying to figure everything out and hope you get it right. With the turnkeys, you don\u2019t have any money in the pot until you confirm everything is up to snuff. That difference in risk-holding is huge!<\/p>\n For help on doing due diligence on turnkeys, check out these three articles:<\/p>\n Now, you do have to add a task to this list of items that you may not have needed on do-it-yourself (DIY) properties:\u00a0managing the property manager.<\/em> This is very different than managing tenants or the property. It\u2019s a completely different set of skills.The Tasks Turnkeys Eliminate for Investors<\/h2>\n
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\nRelated:<\/strong> The Truth About Turnkey Providers No One Tells You<\/a><\/em><\/p>\n\n
Learning the Investing Process With Turnkey Rentals<\/h2>\n
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\nRelated:<\/strong> 4 Steps to Ensure You\u2019re NOT Getting Duped by a Turnkey Provider<\/a><\/em><\/p>\n
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