50k properties, turnkeys, appreciation, and exit strategies
Hey everyone,
I've got about 30K to invest, and am really intrigued by turnkey properties. Having looked at all the various TK companies in different states and cities, it seems buying 2 houses at around the 50k price point would be most advantageous in terms of cash flow.
My concerns are the exit strategies for turn keys @ that price point. Being a new investor, I don't have prior data to go off on the appreciation history of rundown neighborhoods. I would love to be able to exit a house in 5 years and turn the appreciation and cash flow saved from that house into the down payment for 2 more. However, Im not sure that 50k houses appreciate. When I look at those neighborhoods that have houses in them selling for 8k or even lower next to my 50k house, at best I assume it will stay at 50k forever. What makes that area any different then Detroit people are just leaving by the busloads? Maybe an area that has consistent job growth will help raise the values of even these lower priced houses?
So what is everyone's exit strategy for cheap turnkeys? Do they just buy and hold forever and keep saving money from their cash flow and 9-5 job to add more houses for passive income in the future?
This is my second post and must say I love the community here on BP and thank you all for taking the time to provide great insight for us new people browsing every day.
-Ryne