Is turn key necessarily a rip off?

[Adam Craig]

I am looking to load on up some single family homes in Cleveland Suburbs. There are a couple business that sells turn key properties like the site below

http://www.restoringcleveland.com/Property/1490-S.-Noble-Road-Cleveland-Hts-OH-44121-33.html

For someone that wouldn't be doing any repair work, is this a good option? I know I herd before that you pay a premium. Just wanted some thoughts.

[Ryan Mullin]

My company sells both wholesale and turnkey properties. The markup that we put on a turnkey deal is about 6 to 8K. The markup for a wholesale deal is around 2 - 4k. (The entity that funds the turnkey deal has to put in the extra money for rehab and the money is tied up for the extra time so there has to be compensation) With that being said.. when you buy a turnkey deal you are collecting rent immediately. When you buy a wholesale deal.. then rehab it.. then get it rented (and pay the leasing commission) you typically are taking 3 or 4 months to get everything ready.. plus the leasing fee which is 1 months rent. average rent is 750. $750 X 4 months = $3000. My math is rough to say the least but you can see the point I am trying to make. You do "pay a premium" when you buy turnkey but for a true "hands off" investor there is added value. PLUS.. most good turnkey providers have some sort of rehab warranty or rent guarantee built in to the additional costs of buying turnkey..