Hi there BP community!
I need some help deciding what type of property my first (and likely others) will be. I live in Northern Cal where the market for single and multi family homes is too high for any type of cash flow. I have been scouring the listings and working with an agent for a month and nothing even comes close to 1% without at least 125k down. So my question is this; Do I buy out of state using a TK provider/MLS, or focus on condos locally? I have run the numbers for both and they are pretty similar for price and cashflow. Each have their merits. Owning an actual house in the mid-west in very appealing, but I worry about long distance management and dealing with PMs. Owning a condo in my area gives me the peace of mind that I can drive by whenever I want. The down side is that I will need to manage it myself to make the numbers work, which I'm not crazy about. I'm stuck. Your suggestions and experience would be appreciated!
@Torey Chumbley Hi! your dilemna is similar to one I faced for years (prior to knowing about TK). In the area I lived I just couldn't make the numbers work, nor did I have the time or experience to work a rehab or desire to be a landlord (I have managed property before & hated it). I did finally end up going the TK route back in 2012, and haven't regretted it yet. That was in Jacksonville, Fl not the midwest, but I do now have investments in the midwest as well. Key of course is finding the right TK partner or partners, and nothing is more important than the property management component. Good luck in your REI no matter what route you take.
I struggle with the same question. I've read that some turnkeys are impossible to sell once you want to exit. I live in Scottsdale and condos are much more affordable, but carry an HOA fee. I own a $60,000 condo in scottsdale what carries a $300 monthly HOA fee. My brother lives here for free and pays the HOA but I'm not sure how the numbers would work if I was renting it and looking at ROI. Sorry I'm not much help, but I look forward to seeing what others have to say...
This thread is fun already as I'm from Ventura County originally, lived in Tahoe for a couple years around 2007-2009, moved to Scottsdale and lived there 2009-2015, and now live part time in Walnut Creek (way too expensive). So I know your pain, Torey, with the hard to reach cash flows in California, and Krista, I'd love to hear more from you regarding your experience/view on Scottsdale's market. Either way, hope to network with both of you for future successes.
First, this is like a lot of posts tonight, in that the answer is entirely personal. You don't think you want to self-manage, someone else may want to, etc.
I don't think you can fully and reasonably answer the question until you settle in your own mind whether or not you want to be a landlord or just a property owner.