Pearl City, HI · Member since 2015 · 3 posts · 2 votes
Hello BP, new investor here looking for an buyers agent in Birmingham AL. I was "matched" through my lender with a RA but on our second conversation I was asked to sign an exclusive agreement. Honestly I don't feel very comfortable signing a 90 day commitment on such short notice. Any input will be highly welcomed!
Let me know if you're interested in buying turnkeys there. I bought 3 SFRs this way in Birmingham last year and pretty happy with the people I worked with!
Hi @Tommy Castillo, Welcome to BP! Birmingham is one of many great markets to begin investing.
I am not an agent, but would be glad to discuss the market if you have any questions or happen to be looking for wholesalers, vendors, turnkey providers, etc.
Due diligence is very important no matter who you work with, and I would suggest networking as much as you can to build a team of contacts before purchasing in an out of town market. Good luck with your ventures!
Let me know if you're interested in buying turnkeys there. I bought 3 SFRs this way in Birmingham last year and pretty happy with the people I worked with!
There are lots of turnkey providers in Birmingham. Don't sign any exclusive agreement. Just network some , and you find many people who can provide you with properties.
@Tommy Castillo Any time someone that wants to sell you something tries to a get a signature out of you after talking twice, it's time to run. Sounds like you already spotted that red flag ;)
I'm glad to hear you're looking in Birmingham! We have plenty of great opportunities here - it's a great place to live so it's a great place to invest ;) Since you're going out of state (don't blame you for not wanting to invest in pricey HI!) the team you work with should be your number one consideration. If you're going the turnkey route (which is typically they best solution for new investors outside their own market) then you absolutely should do your due diligence, ask around and expect upfront, data-based answers to allllll your questions. Even more than market, having a team you trust to stand by you for the next 10-30 years is the most important factor in a successful TK investment.
Since a lot of new investors are a little daunted by all this 'due diligence' stuff, I put together a quick list of questions you should be asking of any provider you consider. If they can't or won't answer promptly, with hard figures and data to back them up, then it's time to move on.
What is your short/long-term vacancy rates? How are they calculated and how often are they updated?
What is your maintenance rate for this year? How do you expect to do as your portfolio ages and capex expenditures come up?
What is included in your maintenance rate?
What are your typical, high/low, move out costs and are these included in maintenance?
How long does it take after rehab to get a tenant under contract?
How long does it take after move out to get a new tenant in place?
Do you defer maintenance?
What is your PM fee?
What is your leasing fee?
Are there any other fees?
What, exactly, do you do during refurb and what is the expected life on the new appliances/upgrades that you make?
Can you show an appraisal that proves the price I pay is what the property is worth or less?
How are the ROI figures on your site calculated and what, exactly, is included? Can you walk me through these calculations so that I understand how my returns are determined? Are they pro-forma or historical? If pro-forma, what are your estimates based on?
How do you help me track my investment?
Do I have access to information independently?
Do I have the option to contact someone directly (not general office line) to discuss any questions or concerns as they arise?
What is your turnover rate? Average and minimum lease term?
I'm sure others here can add to this list, but these questions will give a good idea of how the company operates and whether or not they are tracking their metrics as they should be. It also gives them the opportunity to show you how transparent they are and how they handle investors that want to be educated - if they don't have time or seem annoyed, look elsewhere.
If you have any questions about TK or the Birmingham market, or anything I've said here, feel free to drop me a line.
I am an attorney in Birmingham and work with a fair amount of investors/wholesalers. Let me know if I can assist with your closings, or if you have any general questions. Thanks.