El Paso, TX · Member since 2018 · 21 posts · 6 votes
Hi Bigger Pockets family,
I wanted to get feedback from anyone who as has any experience with turn key properties. Please tell the pros and cons to help me make a more informed decision. Thank you!
I wanted to get feedback from anyone who as has any experience with turn key properties. Please tell the pros and cons to help me make a more informed decision. Thank you!
Investing in Turnkeys can be great when you live in a market that is TOO hot. You want to look into the Midwest where prices are low but the rent is good. It is a place you can get a decent ROI.
Property Manager · Lindenhurst, IL · Member since 2016 · 854 posts · 506 votes
8y
Generally speaking, assuming the provider is a good one, you get a house that is all fixed-up and rented or ready to be rented, but you'll pay pretty much the retail price.
Turn key is a good way to go for the busy investor that has a full time job and family and can't devote the time to finding a property, a contractor, property manager etc and managing a renovation, especially when investing out of state. Managing a rehab locally can be difficult enough but doing it remotely is much more risky and difficult. Also, you have to some construction knowledge. That doesn't mean you have to know how to swing a hammer but you better have a good understanding of construction techniques and language. If not, you're like blood in the water to sharks. Some contractors will take advantage of those that are not experienced. When working with a reputable turn key company, you are getting the knowledge and experience of an expert.
Investor/RE Broker · Eugene, OR · Member since 2014 · 3k+ posts · 968 votes
8y
As someone who started out my OOS investing in turnkey properties over 5 years ago:
PROS: ease of property purchase, can cash flow from day one, fully rehabbed with tenant in place, can finance the purchase with conventional 30 year fixed with 20-25% down, all in one team (shop); can do a full inspection before closing and hold company accountable to any issues that might arise. Best for the busy investor who wants a fairly passive investment
CONS: likely to be at or close to market value, maybe even over (ie: no equity in deal other than downpayment); a lot of less than competent and/or trustworthy turnkey companies (like elsewhere in REI); need to hold for at least 5-10 years to recover investment on sale; deals today are particularly hard to come by with the best and most established companies
Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
8y
Jairo Rincon i bought turnkeys to start but I lived in Seattle at the time and no where near cashflow markets. See you are in Texas. Why don’t you stay local?
I wanted to get feedback from anyone who as has any experience with turn key properties. Please tell the pros and cons to help me make a more informed decision. Thank you!
Investing in Turnkeys can be great when you live in a market that is TOO hot. You want to look into the Midwest where prices are low but the rent is good. It is a place you can get a decent ROI.
El Paso, TX · Member since 2018 · 21 posts · 6 votes
8y
Thank you all for your feedback.
@Lane Kawaoka I tend to move a lot due to my job. I'm expect to be moving to Nevada here in the near future so I don't want to get started in a market that I won't have much time in.
Real Estate Investor · Kansas City, MO · Member since 2012 · 397 posts · 187 votes
7y
Hi @Jairo Rincon ... curious how your process went? Did you buy yet and if not, what are you still looking for? If so .. how did it go. Happy to help further however we can be helpful!!