{"id":96353,"date":"2019-09-17T17:00:07","date_gmt":"2019-09-17T23:00:07","guid":{"rendered":"https:\/\/www.biggerpockets.com\/renewsblog\/?p=96353"},"modified":"2023-11-06T14:18:24","modified_gmt":"2023-11-06T21:18:24","slug":"most-common-turnkey-rental-misconceptions-solutions","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/most-common-turnkey-rental-misconceptions-solutions","title":{"rendered":"The Most Common Turnkey Rental Misconceptions\u2014And Solutions"},"content":{"rendered":"

I\u2019ve been in and around turnkey<\/a> rental properties for seven years now. It\u2019s actually unbelievable when I think about it, because it seems like just yesterday I was sitting at my corporate engineering job secretly reading Rich Dad Poor Dad<\/em><\/a> by Robert Kiyosaki and Sharon Lechter under my desk.<\/p>\n

I was just like everyone else who started with that book. I had no idea what I was going to get into with real estate investing\u2014or if I was even going to get into real estate investing at all.<\/p>\n

Turnkey-Obsessed<\/h2>\n

\"neighborhood-turnkey\"<\/p>\n

Seven years later, completely unexpectedly, I somehow ended up eating, breathing, and sleeping turnkeys. Could I have ever guessed those would end up being my thing<\/em>? Absolutely not. But here I am. And in those seven years, I\u2019ve not only experienced owning my own turnkey properties, but I\u2019ve also been around hundreds of other investors who have bought, and consequently, owned them.<\/p>\n

I know that when I first started in the turnkey world, I definitely held the two common misconceptions I\u2019m going to present to you in this post. Once I realized they were, in fact, misconceptions, I was able to quickly adjust and roll with the punches. In truth, I\u2019ve seen a lot of turnkey buyers who weren\u2019t so quick to roll with those punches. They also were not so open-minded about what seemed to be going wrong.<\/p>\n

My plan is to give you the dirty reality about turnkeys right here and now so that you are able to (re)set your expectations about them from the start. The more realistic you are about what you are getting into, the better equipped you will be to handle any challenges that may arise. At least mentally you’ll be better equipped, if nothing else.<\/p>\n

Turnkey Misconceptions<\/h2>\n

I\u2019m first going to address the two major misconceptions that a lot of people hold about turnkeys. Then I\u2019m going to offer you a short list of helpful points to keep your expectations in tact and more easily handle the things that may come up.<\/p>\n

When I say turnkeys, at least for this post, I\u2019m referring to turnkey rental properties sold through turnkey providers. You can buy a property anywhere that might be in turnkey-condition, but I\u2019m more specifically talking about buying through actual turnkey providers, so the rehab is done by them, tenants are placed by them, and the property management is set up and running through them.<\/p>\n

Because all of those things are done by the turnkey provider, in addition to the market research and all that jazz, I will say that turnkeys are about as close<\/em> to being hands-off as owning real property can get. Key phrase being as close to<\/em>.<\/p>\n

Ready, set, go!<\/p>\n

Turnkeys Are Too Good to be True<\/h3>\n

\"furnished-turnkey\"<\/p>\n

Ha! I wish. Guess what? Turnkeys are rental properties. If rental properties were always that easy, everyone would buy them. Clich\u00e9, I know. But it\u2019s true.<\/p>\n

Rental properties are never guaranteed to be perfect. (More on this below.) But most generally, if you own a rental property, no matter how you acquired it, there will always be live humans (live humans = complete unpredictability) and a physical structure that you’ll have to deal with.<\/p>\n

There are a lot of advantages to going the turnkey route over doing all the work yourself. The teams are already in place; a good turnkey company will offer a lot of expertise going into your property for you. The cash flow can be great. You don\u2019t have to get your hands dirty, and you are more likely to be able to buy smoothly in multiple markets (which can be extremely financially advantageous) rather than just staying in one. So yes, turnkeys can be fantastic.<\/p>\n

But here are a few reasons why turnkeys aren\u2019t necessarily too good<\/em> to be true:<\/p>\n