Updated almost 9 years ago on . Most recent reply
Turnkey Rental Process
Hey BP members!
I am looking for some advice on Turnkey Rentals. I have 2 single family rentals and 1 fix and flip that we currently have on the market. I have been considering more and more to possibly take the leap and start a turnkey business. The type of deals that I'd be focusing on would be single families. An example of the numbers on these homes that I've worked with are as follows:
Purchase Price: 25,000
Closing Costs: 5,000
Rehab: 25,000
Holding Costs: 3,000
Total: 58,000
ARV: 85,000 (Sale)
Average Profit: 25,000
Now this type of deal would generate about $1300 per month in rental income.
Out of that $1300 an investor can expect to pay:
Taxes: 400
Insurance: 50
Property Management (We'd collect this fee) 10%: 130
Cap Ex 5%: 65
Repairs 5%: 65
Vacancy 8%: 104
These single family rentals we have the tenants pay for all utilities, landscaping, sewer, trash, etc... So out of 1300 your total for debt service is $486
Debt Service should be about $305 Leaving a pure cashflow amount of $181.
The question is does this sound like a good turnkey investment? Let me know if I'm missing something.