Lessons Learned: Turnkey Rentals

[Victor Mora]

3 things I wish I knew before buying turnkey rentals:

1. “Passive” doesn’t mean no problems. The same risks are still present, you’re just outsourcing the work.
   
2. Property management can make or break the deal. A mediocre PM can quietly destroy your returns.
   
3. The real returns come from what you don’t see upfront. Vacancy, repairs, maintenance, tenant quality/turnover, and the trends of the location matter just as much, if not more, than the purchase price.

Turnkey wasn’t a bad decision for me, as it's what got me in the game. But if I were starting again today, I’d spend more time thinking about:

- Downside protection

    - Operator quality

    - Consistency of returns vs headline numbers (in my most recent post, I learned that if you verify the big three independently before writing an offer [tax assessment after sale at purchase price, a real insurance quote from a broker, and cross-checking the rent against closed lease comps, not active listings], you can avoid a lot of the headaches and surprises that plague many first-time turnkey investors! I would have loved to know that before I started :) )

What surprised you most in your first deal?