​What Can Turnkey Do For You?

Every time I go to a convention, I talk to investors and ask them, “What do you think of turnkey?” I won’t lie, a lot of them are leery of this investment model. The reasons they give for this usually have something to do with feeling like they’re not getting a good deal, or a belief that turnkey companies are jacking up the prices for their own profits.

To be fair, there are some sleazeball turnkey providers out there who do exactly that. They take advantage of people simply because they can. As with anything, though, it’s not fair to generalize and punish ALL turnkey companies just because of a few bad eggs. There are plenty of honest providers who want nothing more than to connect investors with good quality, cashflowing properties.

Here’s what a great turnkey company can, and should, do for you:

Find the Property

The turnkey provider’s job is to scout properties that will provide decent returns for investors. They know their market, and they target specific neighborhoods to locate revenue-producing properties with low maintenance and vacancy rates.

Buy It

Once a property is found that meets that criteria, the turnkey company buys it. The property is added to their inventory and will soon be available for investment.

Rehab It

Most properties are purchased in poor condition. They need to be updated with new flooring, paint, and usually new roofs, HVAC, and plumbing systems. Working with their own group of vetted contractors, the turnkey provider rehabs the property to get it up to code and make it an attractive option for renters.

Tenant It

With the property now move-in ready, the turnkey group begins to actively market it to local renters. All prospective tenants go through an extensive vetting process that includes background, employment, and rental history checks.

Manage It

Some turnkey companies partner with management groups so they can continue providing services to investors even after the property has been purchased. This is an excellent deal for the future investor, as the property manager will handle everything from complaints to evictions.

In short, a great turnkey can, and should, handle virtually everything for you. When you enter the picture, your only job is to supply the capital and make sure the property is the right fit for your investment goals. As the owner, there will be decisions you’ll have to make regarding the property, but the turnkey/management company will execute all decisions and handle the day-to-day business of property ownership.

For investors who are new or who are looking for a truly passive investment, turnkey is the best option. Don’t let the naysayers scare you away. This is a tried-and-true model that works, so long as you’re partnered with a knowledgeable and experienced company. Do your homework, read some reviews online, and get referrals before moving forward with a turnkey provider. If everything checks out and you’ve got a great company to work with, you’ll be well on your way to a profitable investment.