Turnkey Rentals and the Dot-com Craze! Is there correlation?

Question

I want to hear from some of the other Turnkey posters on Biggerpockets and anyone else who likes to chime in on the topic.  This is an article I wrote today on the BP blog:

Contrasting Turnkey Real Estate Investments And The Dot-Com Craze!

Would love to hear what others think...

Greg Powers · Answer

Seems to me this would be a no-brainer to investors, but it's nice to hear it broken down in such terms.  When you're buying turnkey properties, you're buying the intrinsic values.  I could buy a cheap property down the street, but it would be much harder for me to find reliable property management.

Obviously the practical value has to come in at a number that would allow me to pay for the intrinsic value and still have a cash flow that's equal or better than all the other ways I could spend my money and time, but it's my job to understand that practical value (via due diligence) and your job to find, fix, sell, and manage it for me.  And if you're good at what you do, and can find investors who understand the trade off (the money value of time, as opposed to the time value of money), then you'll stay in business, as you and Marco have done.

The investors who don't understand this will probably get burned and drop out.  The ones that do will be your repeat customers and keep you in business for the long haul.

Chris Clothier · Answer

@Brian Watkins I appreciate you reading the article and I hope it was helpful.  I can promise you one thing - especially in Atlanta - if you are able to bring top-notch service.  I mean going way above and beyond what investors are accustomed to - then you have a strong chance of building a brand that will last through different housing cycles.  If your business is simply built on selling cheap properties to out of town investors, then your business may ebb and flow.  That is definitely a 30,000 ft view statement since I know nothing about your business, but I talk to a lot of Turnkey investors and not all of them do business with me and I know what is attracting loyalty.  It is not cheap price.

Best of luck to you in Atlanta - I wish you well with your business!

Chris

Brian Watkins · Answer

@Chris Clothier Excellent article. I provide investors with Turn Key properties and this was very insightful.

Ali Boone · Answer

@Marco Santarelli Good to 'see' you too! Haha.

Ali Boone · Answer

Well Matt moved to Argentina, so he won't be able to join, but I should be around! What is the event? Would be great to meet up again, and even if we have to pay a couple bucks for some pancakes, I'm down to keep the tradition alive.

Email me details.

Marco Santarelli · Answer

Hey @Ali Boone:  How are you doing?  Good to 'see' you.  ;-)

Good to hear your ATL properties are doing fine now.  There's certainly more to a good investment than just the bottom line.

Marco Santarelli · Answer

@Chris Clothier:  I'm sure others will chime in soon.  Don't worry.  LOL  ;-)

I'm looking forward to seeing you again in LA on the 22nd.

Continued success!

Chris Clothier · Answer

@Ali Boone - FYI - I am going to be in town next week speaking at an event in the LAX area on Thursday night the 22nd.  I don't think it is National Pancake day, but I would love to catch up with you and Matt while I'm in town.  It is a real estate event so maybe you guys would want to attend?  Let me know if you are around and whether it is there or somewhere else, i'd love to meet up with y'all again.

Chris

Ali Boone · Answer

Oh, a couple of my turnkey properties in Atlanta, while doing fine now, can be the first ones to tell anyone that the bottom line numbers don't hold true if other components aren't there! I try to scream that to people all the time, but you know there will always be plenty who just want that 'return'. Oh well, let them learn the hard way :)

But seriously, a killer article.

Chris Clothier · Answer

@Ali Boone and @Marco Santarelli .  Thanks for reading the article and your responses.  I was really hoping to get some others commenting as well.  The article is as much about investors protecting themselves and buying good TK opportunities as anything else.  If it is all about a bottom-line return for the company or the investor, then it is probably trouble.  Just my opinion, but I've been around for a while too so I feel like I can have one!!  LOL

Hopefully others will chime in as well.

Turnkey Rentals and the Dot-com Craze! Is there correlation?

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