Buying turnkey for my first deal

28 Replies

Normal 1513747178 Investment Property2  1

So you read rich dad poor dad, then you hit the internet searching for ways to invest in real estate and you eventually come across Bigger Pockets. You start reading and asking questions. You sign up for a webinar and watch this corny guy with a bread talk about investing in real estate. You become really excited. This is it! This is what how I'm gonna break free of my job. This is the pretty standard path most of us take. I wish I could say I had a more interesting start but this is exactly how I got interested in real estate investing.

  • OK, so how do I get started?

I didn't have much experience in real estate. I live in an extremely expensive market. House hacking doesn't make a lot of sense here. How the heck am gonna buy real estate? Then i came across the term turnkey. The term turnkey can be overused, but a true turnkey is a property that you hand over the money and do little to no work. I decided this was a prefect way for me to get in the game. I refused to be one of the people that never took action, so turnkey was a great way to get my first deal. Its like buying a property with training wheels on. You get your hand held through the process and at the end you have a producing assets. After researching some companies I decided to buy with Memphis Invest. The main reason I chose to go with them is because they had a great reputation and they were active on BP, so I knew they would be accountable if anything went wrong. Last thing they want is a bad review.

  • The first deal.

I purchased a 5 bd 3 bath in memphis for about 153k it rents for 1500. When you buy turnkey many time you can expect to pay about what the property is worth and sometimes more. I wouldn't recommend purchasing for more than its currently appraised value though. My appraisal came in 2k over what i paid. Its been 2.5 years now and it has by far been my easiest property. When you buy turnkey from a good company you have a much better chance of things going well the first few years.

  • What I learned.

Buying turnkey gave me the opportunity to learn the basics with a real world example. I got my first inspection report and as you will eventually realize, it usually seems alot worse than it really is. The reason is the inspector will list every little thing. I learned the process of working with a lender and how much personal information they needed. I got familiar with property manager software and how my owners portal worked. This was a real world experience. Stuff I couldn't learn from a book with out taking action.

  • From my first deal to 3 more in 8 months.

From there I moved fast. I knew I wanted to get my own deals so i could get better returns and better deals. I found a mentor @David Greene. (Who actually just wrote the new BP book Long-Distance Real Estate Investing). I highly recommend picking that up. Having a mentor gave me the confidence and validation I needed to pull the trigger on buying more property without the training wheels. I then went on to buy a single family property in Jacksonville and two properties in Cleveland (one single and duplex). All of which take way more work than my first turnkey property but produce more cashflow. There is a trade off.

If it weren't for that first turnkey deal I wouldn't have been able to buy properties on my own. It allowed me to get the training I needed to build enough confidence to go after my own deals. Its a great way to get started and learn the basics.

If you are starting out and want to hear more please reach out anytime. Im an open book and happy to share my experiences. 


I have read of several of these turnkey companies.  I believe it is a great way for some folks to get started, especially if you are investing from a distance.

I think a partial ownership is a stronger investment because the folks running it have skin in the game also.  This could be a problem with financing for some, but the returns can be lucrative with a limited equity position and limited liability.  

Hey Billy, 

First off, I want to say thanks for writing this post. It touched home with me, and made me feel like I'm not the only one struggling with the SoCal Struggle! Im happy to hear that your journey into real estate has gone smoothly! I am located in San Diego, and I find myself getting discouraged by the prices here in San Diego. Im going through the same " How the heck am I going to buy real estate?". I am contemplating buying in other, more affordable markets. I listened to the podcast with David Greene. It was really inspiring, however I still find myself at a roadblock. It sounds like you would recommend buying a turn key property to get my feet wet. Any other suggestions that can help make the idea less intimidating?

Originally posted by @Billy Maloney :

Normal 1513747178 Investment Property2  1

So you read rich dad poor dad, then you hit the internet searching for ways to invest in real estate and you eventually come across Bigger Pockets. You start reading and asking questions. You sign up for a webinar and watch this corny guy with a bread talk about investing in real estate. You become really excited. This is it! This is what how I'm gonna break free of my job. This is the pretty standard path most of us take. I wish I could say I had a more interesting start but this is exactly how I got interested in real estate investing.

  • OK, so how do I get started?

I didn't have much experience in real estate. I live in an extremely expensive market. House hacking doesn't make a lot of sense here. How the heck am gonna buy real estate? Then i came across the term turnkey. The term turnkey can be overused, but a true turnkey is a property that you hand over the money and do little to no work. I decided this was a prefect way for me to get in the game. I refused to be one of the people that never took action, so turnkey was a great way to get my first deal. Its like buying a property with training wheels on. You get your hand held through the process and at the end you have a producing assets. After researching some companies I decided to buy with Memphis Invest. The main reason I chose to go with them is because they had a great reputation and they were active on BP, so I knew they would be accountable if anything went wrong. Last thing they want is a bad review.

  • The first deal.

I purchased a 5 bd 3 bath in memphis for about 153k it rents for 1500. When you buy turnkey many time you can expect to pay about what the property is worth and sometimes more. I wouldn't recommend purchasing for more than its currently appraised value though. My appraisal came in 2k over what i paid. Its been 2.5 years now and it has by far been my easiest property. When you buy turnkey from a good company you have a much better chance of things going well the first few years.

  • What I learned.

Buying turnkey gave me the opportunity to learn the basics with a real world example. I got my first inspection report and as you will eventually realize, it usually seems alot worse than it really is. The reason is the inspector will list every little thing. I learned the process of working with a lender and how much personal information they needed. I got familiar with property manager software and how my owners portal worked. This was a real world experience. Stuff I couldn't learn from a book with out taking action.

  • From my first deal to 3 more in 8 months.

From there I moved fast. I knew I wanted to get my own deals so i could get better returns and better deals. I found a mentor @David Greene. (Who actually just wrote the new BP book Long-Distance Real Estate Investing). I highly recommend picking that up. Having a mentor gave me the confidence and validation I needed to pull the trigger on buying more property without the training wheels. I then went on to buy a single family property in Jacksonville and two properties in Cleveland (one single and duplex). All of which take way more work than my first turnkey property but produce more cashflow. There is a trade off.

If it weren't for that first turnkey deal I wouldn't have been able to buy properties on my own. It allowed me to get the training I needed to build enough confidence to go after my own deals. Its a great way to get started and learn the basics.

If you are starting out and want to hear more please reach out anytime. Im an open book and happy to share my experiences. 

 Good post. Keep it up!

Originally posted by @Billy Maloney :

Normal 1513747178 Investment Property2  1

So you read rich dad poor dad, then you hit the internet searching for ways to invest in real estate and you eventually come across Bigger Pockets. You start reading and asking questions. You sign up for a webinar and watch this corny guy with a bread talk about investing in real estate. You become really excited. This is it! This is what how I'm gonna break free of my job. This is the pretty standard path most of us take. I wish I could say I had a more interesting start but this is exactly how I got interested in real estate investing.

  • OK, so how do I get started?

I didn't have much experience in real estate. I live in an extremely expensive market. House hacking doesn't make a lot of sense here. How the heck am gonna buy real estate? Then i came across the term turnkey. The term turnkey can be overused, but a true turnkey is a property that you hand over the money and do little to no work. I decided this was a prefect way for me to get in the game. I refused to be one of the people that never took action, so turnkey was a great way to get my first deal. Its like buying a property with training wheels on. You get your hand held through the process and at the end you have a producing assets. After researching some companies I decided to buy with Memphis Invest. The main reason I chose to go with them is because they had a great reputation and they were active on BP, so I knew they would be accountable if anything went wrong. Last thing they want is a bad review.

  • The first deal.

I purchased a 5 bd 3 bath in memphis for about 153k it rents for 1500. When you buy turnkey many time you can expect to pay about what the property is worth and sometimes more. I wouldn't recommend purchasing for more than its currently appraised value though. My appraisal came in 2k over what i paid. Its been 2.5 years now and it has by far been my easiest property. When you buy turnkey from a good company you have a much better chance of things going well the first few years.

  • What I learned.

Buying turnkey gave me the opportunity to learn the basics with a real world example. I got my first inspection report and as you will eventually realize, it usually seems alot worse than it really is. The reason is the inspector will list every little thing. I learned the process of working with a lender and how much personal information they needed. I got familiar with property manager software and how my owners portal worked. This was a real world experience. Stuff I couldn't learn from a book with out taking action.

  • From my first deal to 3 more in 8 months.

From there I moved fast. I knew I wanted to get my own deals so i could get better returns and better deals. I found a mentor @David Greene. (Who actually just wrote the new BP book Long-Distance Real Estate Investing). I highly recommend picking that up. Having a mentor gave me the confidence and validation I needed to pull the trigger on buying more property without the training wheels. I then went on to buy a single family property in Jacksonville and two properties in Cleveland (one single and duplex). All of which take way more work than my first turnkey property but produce more cashflow. There is a trade off.

If it weren't for that first turnkey deal I wouldn't have been able to buy properties on my own. It allowed me to get the training I needed to build enough confidence to go after my own deals. Its a great way to get started and learn the basics.

If you are starting out and want to hear more please reach out anytime. Im an open book and happy to share my experiences. 


 Nice post Billy.

Are you going to follow it up with a breakdown of the other 3 properties? Some pro's & con's of those vs. your original & I assume most expensive & stable investment.

Congrats on your success!  Not everyone has success with turnkey companies, and many of them end up with properties that aren't worth what they paid for them.  So I am glad to hear about someone's success using this process.

How did you determine what other markets you would go into?  How did you choose Cleveland? Jacksonville?  In fact, how did you choose Memphis Invest for your first deal, and where was that one located (I assume they sell properties beyone Memphis, right?)?

Thanks for sharing your story @Billy Maloney , you were a big help with getting me started, I'm sure this story will inspire others past analysis paralysis as well.

Great to see you're doing well and awesome to hear you've been working with David Greene, I just started reading his book too :)

@Jeremy Leech as side from my turnkey property there has been nothing smooth about it actually. Ive run into alot of issues that were too much to write in one post.I have made some mistakes for sure part of taking action.  The problems I have had are all part of the game and each one has taught me the something.  Really the only way to get over the intimidation is to get your first deal.  You have to get comfortable with being uncomfortable at first until you develop the ability to handle your fears and stop worrying about the what ifs.  Even with my TK deal i woke up in a panic for weeks haha. Thinking am i doing the right thing? In the end it worked out just fine and if it didnt I would have figured it out.   One thing i have learned is at the end of the day its on you to make the decision what works best for you.  I spent months looking for someone to validate me and tell me what the best thing to do was. You re doing the right things asking but end of the day you cant avoid that you have to decide what will work for you and realize its all on you. 

@Cara Lonsdale  Well a big part of the markets I invested in had to do with friends that were already investing there, so i was able to get references to work with.  At first I was all over the place, still kind of am haha.  I just started looking at deals and if they looked good i moved forward.  In hind sight I wish I would have been more focused.  I still got alot to learn. 

I went with memphis invest because had a great reputation.  They seemed like one of the safer choices and at the time i needed that because i was already worried about of all the things that could go wrong.  Also I noticed one of the owners @Chris Clothier is pretty active on BP, so i knew there would be some accountability.  If they did me wrong I d be sure to let everyone know about.  I bought in memphis and yes they are in 3 or 4 markets now. 

Great work Billy Maloney, I have just ordered James Greene book and now even more, looking forward to reading it. I started locally and now that I have a little experience want to expand out of state. Thanks for the post, as others have stated, we would love to see the numbers, and how you worked your way through all the properties. Following your discussion with anticipation. Thanks again.

@Billy Maloney Congratulations on scaling so quickly and getting past the first deal :)

Most people think that seeking help may be perceived as a sign of weakness and try to do everything by themselves especially in beginning. Clearly, you sought out a company to help you and then a mentor you help you navigate the somewhat muddy waters of real estate investing.  

Thanks for sharing this. Good luck, Thanks! - Ola

@Billy Maloney - Thanks for the post. I'm from California also and have thought about turnkey investing out of state. There are so many questions to consider before taking the plunge so I ended up getting the book!  Would love to hear about your experiences sometime.

The management company is the end game here.  A good management company is the crucial piece.  Solid construction and good areas helps a lot as well in a TK deal. Nice work.  Keep at it.

@Billy Maloney  Nice post!  You share a story that is common among many new investors.  While its' not unique among some of my clients, it is unique that you are sharing it and so openly showing the reality of learning "how-to" invest in real estate.

Turnkey is simply a form of passive investing.  But, it can teach you a lot about some of the workings of investing if you pay attention.  There are a lot of investors in your shoes who want to get started and choose this form of passive investing to do it.  From there, they branch out and get active in local meet-ups to find others they can learn from.  So often, when you are not an investor, it is hard to walk up to someone at a real estate meet-up and ask for help learning.  It takes getting started to really "get started".

You've shared a lot of good tips here and the reality that everything will not go perfect.  However, you will miss 100% of the shots you don't take, so if you truly want to invest, you have to get started somehow.  

On a personal note, nothing makes us happier as entrepreneurs with a family-owned business than when a client moves past buying a passive portfolio and says they are going to build an active business.  We have a great relationship with many investors like you who bought a first property with us and then branched out and grew other companies.  @Haim Mamane Palman is one example one an investor on here who comes to mind.  I have had nothing to do with your success as a passive investor, but it makes us very proud to know that you bought a property from us to get started and have moved on to bigger things.  As always, let me know how I can assist you as an entrepreneur and active investor.

Sincerely, all the best to you and we hope to continue to read about your success!

@Billy Maloney   I am curious about your thought process of buying in multiple markets as opposed to concentrating your investing in one market ? 

can you elaborate on that ?

@Dan F. any time man. 

@Chris Clothier Thank you.  Really appreciate it.  Your company definitely allowed me to ease into the game.  

 I love that way of thinking that you miss 100% of the shots you dont take. The reality is when things were going great I learned nothing. When things go wrong I remind myself to be grateful for the experience and the opportunity to learn and grow. Id had my fair share of issues and I plan to share them because we can all learn from them together. 

Originally posted by @Billy Maloney :

@Dan F. any time man. 

@Chris Clothier Thank you.  Really appreciate it.  Your company definitely allowed me to ease into the game.  

 I love that way of thinking that you miss 100% of the shots you dont take. The reality is when things were going great I learned nothing. When things go wrong I remind myself to be grateful for the experience and the opportunity to learn and grow. Id had my fair share of issues and I plan to share them because we can all learn from them together. 

 Excellent!

@Jay Hinrichs That is a great question.  Investing in 3 markets is a result of "taking action " overload mixed with shiny object syndrome haha.  I wouldn't say the properties I bought were shiny but the numbers were!!! big difference.   When i spoke with various people they would suggested the markets they were investing in and offer to connect me to an agent work with.  I kept sayings sure why now.  Then when that agent sent me a good looking deal i went for it.  One of the most difficult things out of state investors have to deal with is choosing a market. Once you decide that you are going to invest outside your own market the whole country basically becomes your playground. I wish I could say I really thought and planned it out but i did not. If I were to do it over I would have probably focused my efforts and i would advise other people to do the same.  Its has allowed me to expand capacity to handle more at once and now I suppose you can say I'm diversified.  My goal from here is to focus more and create solid systems.  

@Billy Maloney   so you were market agnostic and went with what you thought were the best numbers.

did the ground teams play into that or was it mainly numbers ?

@Jay Hinrichs in a way yes I was agnostic.  I went with the opportunities that were presented to me. The team on the ground came recommended by people I trusted. I did my homework, ran my numbers made offers and looked for any signs to walk away.  If everything seemed good at that point I took the leap.  There were deals I walked away from for various reasons.  When I look back I believe I did things the way they should be done but one thing you cant predict is a smooth ride. Sometime you have to learn what not to do to figure out what to do. 

well certainly wish you the best with it and thanks for sharing.. its always interesting to see what thought process folks follow when they decide to invest in one place over another. especially when the numbers are so similar market to market..