Feedback on Turn Key RE Companies

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Feedback on Turn Key RE Companies

Joe Martella
Rental Property Investor · Cherry Hill, NJ · Member since 2015 · 626 posts · 495 votes

Hello,

I am new to the Out of State investment practice.  In my research, U came across Norada Real Estate and Home Union.  Anyone one here do business with either company?  I am looking  for feedback.

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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
11y

@Account Closed  I hear ya about cradle to grave... you partner with them to the end or at least as long as your in business.

I was one of the first into the Turn Key space along with a few others I entered in 2002 ish.

95% of those that were in the space then are gone...

And 10 years from now 95% of those that are in it will be off and doing other things just the way RE works...

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  • Charles Worth
    Investor · New York City, NY · Member since 2015 · 808 posts · 417 votes
    11y

    @Alex Craig

    Although I think they don't like to spin it this way, being from Wall Street I can tell you that a lot of what HU seems to be trying to do is make some of the stuff in RE more Wall Street like. a 1% fee is standard in other investments so someone who is not familiar would probably not even question it because you are used to it.  It could even be considered low as many funds charge more but its often as a % of assets under management.

    This makes sense because a lot of the people I believe they deal with (again just my opinion and from talking to certain people) are a lot more passive than TKs are dealing with in many cases. 

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  • Charles Worth
    Investor · New York City, NY · Member since 2015 · 808 posts · 417 votes
    11y

    @Jay Hinrichs

    For my 2 cents you are right about the value proposition not necessarily being clear vs. just buying off the MLS as well as about some of the pseudo science being talked about related to looking at properties.

    One could very easily do the same thing by finding a local MLS agent and having them recommend a PM as, at least when I looked at it, it was all MLS properties and TK referrals. Their business model has changed a little bit though. When I was talking to them (before I knew anything at all) it really didn't cost anything more than going through a regular agent and because they were in a lot of cities you could learn a bunch of cities and see which one was right. They also had someone overseeing the local location manager so it was kind of like playing big company politics though I think this might have been more unique to me because I came in from talking to people at the corporate office. So in short, no real cost except for their asset management fee which at the time was optional after the first year if I remember correctly. This has all changed now as I assume their services, software and build out was a lot more expensive than a typical RE agent's expenses.

    However, as someone used to dealing with startup technology and wall street I can tell you that I instantly understand what they are trying to do. My opinion the company is first a tech startup first and foremost. They have done a very good job at the things startups are good at such as technology, software and ads. Don the CEO has a software and sales background not a RE background so this is to be expected.  What does this mean? More than anything else it means that it may not matter so much what us dedicated real estate investors think because we are not the target audience.  As long as the company can win on the customer acquisition side (and they do a very good job of this, I know good tech marketing when I see it) and by impressing with snazzy software (again better than any other firm I have come across since that sells something) they do not necessarily need to focus on getting the returns you may think are proper as long as they do well enough operationally to get decent returns and keep people who are more used to the stock market happy at least ion the aggregate (as we know a certain percent will have a really bad experience simply because of the inherent risk in the asset class through things like move outs, bad tenants etc.).

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  • Krista Walker
    Cave Creek, AZ · Member since 2015 · 51 posts · 13 votes
    11y

    I'm new to BP and this was a very informative thread! I've wondered about TK properties as I've listened to Jason Hartman and they provide a similar service. 

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  • Jason Hartman
    Rental Property Investor · Scottsdale, AZ · Member since 2012 · 314 posts · 146 votes
    11y

    Hi @Krista Walker - We're here and happy to assist you. 

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