Thinking about supplying turnkey rentals in Orlando area

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Thinking about supplying turnkey rentals in Orlando area

Michael Plante
Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes

Bought my first house fixed up and rented out 30 years ago in Medina NY.     

Did the same a few years later in Wilmington NC.  

Then onto St Pete FL.    

And now Osteen, Deland and and Eustis FL.   

Looking around it seems people are looking for turn key, if my understand of the definition of turn key is correct, in Orlando area but not finding it

So you think there is an interest in this?   If so how would you go about doing it from my side?

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Kim Meredith HamptonBusiness Member
Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
9y
Michael, Their are turnkey properties, but further and few between these days. In Orlando. We provide full turnkey, but find most of our properties now with better cash flow are in Pasco, Pinellas, Hillsborough, Polk and Palm Bay
[email protected]407-448-6679Podcast Guest on Show The Key to Scoring Discounted Deals in One of America’s Hottest Markets
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  • Ali Boone
    Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
    9y

    I do think there would be an interest but I think feasibility is a different story. The #1 thing you have to be able to offer with turnkeys is cash flow, and I don't think there's cash flow in Orlando right now. So the first thing you would want to do is see if the numbers could support it. I really don't want to be a buzzkill for it, but even during the crash when prices all over the place were crazy-low, Orlando still wasn't offering much on the numbers. A few of the big turnkey suppliers in Atlanta at the time were actually from Orlando and had moved up to Atlanta specifically to do turnkeys up there. And now we aren't even in a crash and prices are high. So, check those out before anything else.

    Not to sound crass, because I really am super concerned about everyone in FL right now with Irma looming, but I think your only hope for a cash flow potential/turnkey situation right now is if Irma really does destroy a lot of the area and suddenly housing prices crash because everything needs to be built back up. 

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  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Ali Boone:

    I do think there would be an interest but I think feasibility is a different story. The #1 thing you have to be able to offer with turnkeys is cash flow, and I don't think there's cash flow in Orlando right now. So the first thing you would want to do is see if the numbers could support it. I really don't want to be a buzzkill for it, but even during the crash when prices all over the place were crazy-low, Orlando still wasn't offering much on the numbers. A few of the big turnkey suppliers in Atlanta at the time were actually from Orlando and had moved up to Atlanta specifically to do turnkeys up there. And now we aren't even in a crash and prices are high. So, check those out before anything else.

    Not to sound crass, because I really am super concerned about everyone in FL right now with Irma looming, but I think your only hope for a cash flow potential/turnkey situation right now is if Irma really does destroy a lot of the area and suddenly housing prices crash because everything needs to be built back up. 

    We are getting great cash flow not directly in Orlando a little ways out

    With plenty more

    Hence thinking about providing turnkey properties

    1Reply
  • Kim Meredith HamptonBusiness Member
    Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
    9y
    Michael, Their are turnkey properties, but further and few between these days. In Orlando. We provide full turnkey, but find most of our properties now with better cash flow are in Pasco, Pinellas, Hillsborough, Polk and Palm Bay
    [email protected]407-448-6679Podcast Guest on Show The Key to Scoring Discounted Deals in One of America’s Hottest Markets
    Compass | St. Pete514 Reviews
    WebsiteView Page
    2Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Kim Meredith Hampton:

    Michael,

    Their are turnkey properties, but further and few between these days. In Orlando. We provide full turnkey, but find most of our properties now with better cash flow are in Pasco, Pinellas, Hillsborough, Polk and Palm Bay

     Maybe we are more fortunate than I thought as we definitely have quite a few in the Orlando area, but than again we are putting a unique twist which doesn't cost much but really pushes the amount of monthly rent up quite a bit

    The  more responses I see in this thread the more I believe there is a need for what we're doing seems no one else is  

    0Reply
  • Ali Boone
    Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
    9y

    Then it could be an option. I'm happy to look a sample property over if you want to send one over. I could give you feedback on whether it would be appealing to a turnkey investor. (I'm a turnkey investor myself and my entire business is based on helping people buy turnkeys, so I deal with turnkey investors all the time)

    Shoot, if you can offer some enticing stuff, I'd be interested and I know lots of folks who might be as well! Just depends on what you can offer.

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y

    VERY nice of you. 

    The idea of doing this just came up in the past 2 days after seeing so many posts looking in FL and not being able to find. 

    Up until now we have just been using our own cash and have not had to do any financing.  

    I need to decide if we want to give up these honey holes or keep them to ourselves. 

    Thank you 

    0Reply
  • Account Closed
    Investor · Bushnell, FL · Member since 2016 · 456 posts · 224 votes
    9y

    Michael , 

    I agree with you completely about finding value outside the big cities .. like in Deland and Eustis area's .. i have had my eye on Inverness for a while now and see great potential there as properties are still only selling fir 1/2 as much as they were before the bust .. i see many 3/2 1200+ sqft  listed for around the $75k mark .. of course most need some rehab to become truely rentable but the rents in the area have gone up considerably as of late .. 

    Im also familer with the Eustis and Mt Dora ..ect .. surrounding areas .. 

    Would love to maybe see if there might be a way we might be able to help each other in some way .. 

    If your interested just send me a colleague request .. 

    By the way, I just made a contact about two weeks ago that is looking for exactly what your proposing.. turn key properties .. he is looking for someone who can provide at least 1-2 a month .. 

    I look forward to hearing back from you .. maybe .. 

    wishing you the very best ..

    God Speed, 

    Michael Short   

    1Reply
  • Jeff Wallenius
    Specialist · Indianapolis, IN · Member since 2014 · 670 posts · 352 votes
    9y

    @Michael Plante obviously finding the deals is a huge part of becoming successful as a turnkey provider but there is more to it than that for sure. How do you plan to deal with property management? Property management alone can crush a turnkey business and is most often the cause of failed turnkey properties. I do wish you the best of luck, just my two cents.

    1Reply
  • Joseph M.
    Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
    9y

    Sounds like there could be a good opportunity. I'd say overall many might find investing in Florida to be more appealing than the Midwest as long as they can get cash flow. I was buying properties in Jacksonville a couple years ago and there were some great deals. I haven't looked at the market too much recently but I have heard it's pretty hot. I did find it hard to find deals back then in Orlando and it was a more competitive market. 

    California investors especially seem to be attracted to turnkey because it's so hard to cash flow in the state at current prices. In NY seems there is more opportunity if you go upstate for example. Or even closer than that. In Buffalo you can still buy properties for under $50,000 . Not possible anywhere in CA to my knowledge. During the crash you could buy under $50k easily in central CA and some other places but of course those days are over. 

    Huge demand especially now because real estate is 'cool' again.

    1Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Account Closed:

    Michael , 

    I agree with you completely about finding value outside the big cities .. like in Deland and Eustis area's .. i have had my eye on Inverness for a while now and see great potential there as properties are still only selling fir 1/2 as much as they were before the bust .. i see many 3/2 1200+ sqft  listed for around the $75k mark .. of course most need some rehab to become truely rentable but the rents in the area have gone up considerably as of late .. 

    Im also familer with the Eustis and Mt Dora ..ect .. surrounding areas .. 

    Would love to maybe see if there might be a way we might be able to help each other in some way .. 

    If your interested just send me a colleague request .. 

    By the way, I just made a contact about two weeks ago that is looking for exactly what your proposing.. turn key properties .. he is looking for someone who can provide at least 1-2 a month .. 

    I look forward to hearing back from you .. maybe .. 

    wishing you the very best ..

    God Speed, 

    Michael Short   

    Sounds great

    Thank you request sent 

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Jeff Wallenius:

    @Michael Plante obviously finding the deals is a huge part of becoming successful as a turnkey provider but there is more to it than that for sure. How do you plan to deal with property management? Property management alone can crush a turnkey business and is most often the cause of failed turnkey properties. I do wish you the best of luck, just my two cents.

     Thank you for your post 

    I have actually done property management in 3 states 

    Bought and managed rentals starting over 30 years ago in NY. 

    Have also managed rentals in NC and FL as well as having my real estate license on those states as well. 

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Joseph M.:

    Sounds like there could be a good opportunity. I'd say overall many might find investing in Florida to be more appealing than the Midwest as long as they can get cash flow. I was buying properties in Jacksonville a couple years ago and there were some great deals. I haven't looked at the market too much recently but I have heard it's pretty hot. I did find it hard to find deals back then in Orlando and it was a more competitive market. 

    California investors especially seem to be attracted to turnkey because it's so hard to cash flow in the state at current prices. In NY seems there is more opportunity if you go upstate for example. Or even closer than that. In Buffalo you can still buy properties for under $50,000 . Not possible anywhere in CA to my knowledge. During the crash you could buy under $50k easily in central CA and some other places but of course those days are over. 

    Huge demand especially now because real estate is 'cool' again.

    Really great points thank you. 

    I am fortunate as I live in both update NY and Central FL have had my real estate license in both states 

    Bought my first rental just outside of Buffalo over 3O years ago and my first rental in Fl 20 years ago.   Also managed all of them. 

    Until joining Bigger Pockets I never knew there was such demand for things we have been doing for ourselves.  

    As I say though I am not sure we are interested in giving away these deals when we could keep them to ourselves 

    Why do turnkey companies sell them off?

    What sort of profit can be made?

    How does it usually work?

    Thank you  

    0Reply
  • Sebastien Hitier
    Rental Property Investor · Hong Kong, Hong Kong Island · Member since 2014 · 188 posts · 114 votes
    9y

    Hi @Michael Plante, what kind of ARV, gross and net rental yield do you think Orlando can offer?

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y

    I just buy with cash, fix up sell holding the mortgage

    Here are a couple I am doing now buy 62k. Rehab 18k.  Sell 154k.  Have been offered 1600/month to rent 

    Buy 40K. Rehab 16k.  Sell 99k.  Similar in the area rent for 1000/mo

    Reading about all the people looking for turnkey has got us thinking maybe we should offer that. 

    But then I think what is the reason I would want to do that as opposed to what I am doing now?

    What sort of return could we get?

    If we did it we could supply everything including tenent selection/screening, property management, everything.   

    But thinking what is the incentive for us giving away our gold nuggets instead of keeping them for ourselves?

    0Reply
  • Teddy Smith
    Real Estate Broker · Wilmington, NC · Member since 2016 · 236 posts · 126 votes
    9y

    I do this in Wilmington currently. Wouldn't classify myself as a "true" turnkey provider, because I don't provide property management (outsource it). 

    There's a demand in every market for turnkey rentals. Trick is getting in front of people that are interested! Orlando sounds like it would be a tough nut to crack. Wilmington is great because all properties provide some degree of cash-flow, but you have to be the guy/gal that can provide the best quality.

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Teddy Smith:

    I do this in Wilmington currently. Wouldn't classify myself as a "true" turnkey provider, because I don't provide property management (outsource it). 

    There's a demand in every market for turnkey rentals. Trick is getting in front of people that are interested! Orlando sounds like it would be a tough nut to crack. Wilmington is great because all properties provide some degree of cash-flow, but you have to be the guy/gal that can provide the best quality.

    Small small world.   

    I was a snowbird in Wilmington in my mid 20s buying, fixing up and selling or renting out. 

    Got my NC real estate license for access to the MLS and to get some commission on the properties I purchased.

    Beautiful place but a little too cold for me in the winter so we live in FL in the winter now.  

    0Reply
  • Carrie A.
    Dubois, IN · Member since 2016 · 120 posts · 16 votes
    9y
    Just a thought.... it may not be the best time to buy in Florida......... ;)
    0Reply
  • Ingrid J.
    Investor · Tromsø, Norway (Europe) · Member since 2015 · 431 posts · 194 votes
    9y

    @Michael Plante I definitely think there is an interest in it.

    If you do decide to go into turnkey I would research the competition. List up their advantages and disadvantages, and see what customers have to say about them. You can learn a lot about your customers through the stories they tell you about the competition. 

    1Reply
  • Michael Lester
    Flipper · Buffalo, NY · Member since 2017 · 33 posts · 7 votes
    9y

    I'm in Buffalo, NY at the moment. Buying and selling. Left California for a market I could better penetrate. 
    I'm kind of disheartened to see nobody mention that the thick profit margins lay between what's mortgageable and what is not mortgageable. Problem with buying turn key is that you will be competing against purchasers with the banks money, driving prices way up. 40% of whom are putting less than 9% down, with little financial education. 
    Contact me if you ever wanna talk. 
     

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  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Michael Lester:

    I'm in Buffalo, NY at the moment. Buying and selling. Left California for a market I could better penetrate. 
    I'm kind of disheartened to see nobody mention that the thick profit margins lay between what's mortgageable and what is not mortgageable. Problem with buying turn key is that you will be competing against purchasers with the banks money, driving prices way up. 40% of whom are putting less than 9% down, with little financial education. 
    Contact me if you ever wanna talk. 

     Not sure who you were talking to

    I have more deals than I can do and was thinking of possibly offering turnkey properties. 

    0Reply
  • Michael Plante
    OP
    Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
    9y
    Originally posted by @Carrie A.:
    Just a thought.... it may not be the best time to buy in Florida......... ;)

    Not sure what you mean.  I am seeing plenty of opportunities. 

    0Reply
  • Carrie A.
    Dubois, IN · Member since 2016 · 120 posts · 16 votes
    9y

    @Michael Plante.....  I was being sarcastic.....  I was referring to the hurricane that hit Florida.

    0Reply
  • Michael Lester
    Flipper · Buffalo, NY · Member since 2017 · 33 posts · 7 votes
    9y

    lol.

    0Reply
  • Michael Jones
    Investor · Deltona, FL · Member since 2013 · 9 posts · 3 votes
    9y

    @Michael Plante There is definitely interest from my end.

    0Reply
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