Why doesn't everyone use RenttoRetirement?

Question

Now I know it is not for EVERYONE because some of us are out there getting slamming good deals, but rent to retirement has realitively low barrier to entry (18-35k) and has pretty great returns (12-18%). Why are more people not jumping on that if they don't have great deals locally or enough leads? It seems pretty great.

I am asking partly because continually saving up for a R2R house every 10 months might be my next investment plan and want to see the cons.

I am asking partly because continually saving up for a R2R house every 10 months might be my next investment plan and want to see the cons.

Zach Lemaster · Answer

@Quinn Barnett

I would like to know the same thing, lol!

I can tell you that we have many clients investing with us each month, and have thousands of deals under our belt.  Many of these investors have talked about their experience on BP.  I will post many links below for you to review in effort to help answer your question.  This may not be the appropriate strategy for everyone.  Investors this strategy fits well with are those looking to get starting investing in different markets, or to scale/diversify their portfolio.  There are many different locations and asset classes available.  I would recommend exploring new construction in FL that has immediate equity upon completion that can either be sold for a gain, or refinanced to pull capital back out to reinvest (very similar to the brrr method), but with new construction that has many benefits over a rehab project.  That way you can be creative to stretch your capital further to scale quicker.  Example: $275k new build that can be done with 10% down construction loan (~$30k).  Valuation upon completion should appraise (or sell to retail buyer) in the $310k to $330k range allowing great options to cash out refi, sell, etc.  Homes will rent for $2,100 to $2,200 so will still cash flow well any way you do it.  Just something to consider.  Happy to clarify any points you would like.

Hopefully these links will add some perspective about the various reasons investors have chosen to go this route.

https://www.biggerpockets.com/users/ZacharyCole/references

https://www.biggerpockets.com/forums/92/topics/518583-feedback-on-renttoretirement-and-zach-lemaster

https://www.biggerpockets.com/forums/92/topics/765347-rent-to-retirement-review

https://www.biggerpockets.com/forums/850/topics/895660-my-first-investment-property-an-out-of-state-deal

https://www.biggerpockets.com/...

https://www.biggerpockets.com/co/RentToRetirement

https://www.biggerpockets.com/forums/92/topics/929410-rent-to-retirement-updates?highlight_post=5508807&page=1#p5508807

https://www.biggerpockets.com/forums/92/topics/893621-rent-to-retirement-review?highlight_post=5222888&page=1#p5222888

https://www.biggerpockets.com/forums/311/topics/915728-experience-with-rent-to-retirement-turnkey?page=1#p5345200

https://www.biggerpockets.com/forums/92/topics/808479-rent-to-retirement-experiences

https://www.biggerpockets.com/forums/67/topics/952977-turnkey-in-indianapolis-through-rtr-case-study

https://www.biggerpockets.com/forums/12/topics/533693-anyone-worked-with-renttoretirement-turnkey

https://www.biggerpockets.com/forums/92/topics/581730-rent-to-retirement-zach

https://www.biggerpockets.com/forums/48/topics/874096-reviews-on-r2r-and-nch?page=1&utm_source=Iterable&utm_medium=email&utm_campaign=Transactional:%20topic_notification&utm_content=Transactional#p5123754

https://www.biggerpockets.com/forums/311/topics/883772-turnkey-investing-renttoretirement-feedback-reviews?highlight_post=5171720&page=1#p5171720

https://www.biggerpockets.com/forums/92/topics/950188-rent-to-retirement?page=1&utm_source=Iterable&utm_medium=email&utm_campaign=Transactional:%20topic_notification&utm_content=Transactional#p5535505

https://www.biggerpockets.com/users/ZacharyCole/references

Taylor L. · Answer

Generally investors will run out of their own capital and credit relatively quickly when investing in turnkeys.