Rent to Retirement?

Question

Hey guys I know the company, Rent to Retirement, has been featured a lot on Bigger Pockets and has gained some traction in the overall real estate space.

I was wondering if anyone has any experience working with these guys, or if anyone is in the process of looking at properties they are offering?

Zach Lemaster · Answer

@Hnu Thaper

Thanks for the interest!  There have been a ton of discussion on this topic from previous & current investors if you search the forums.  Here are some previous threads that may assist you in answering your questions.  Feel free to reach out with any questions.

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/co/RentToRetirement

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/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/users/ZacharyCole/references

Joseph Schweizer · Answer

Hi @Hnu Thaper!

I purchased my first investment property with the help of RTR in October 2020. It has only been about 5 months (short amount of time in terms of buy and hold real estate), but so far so good. Tenant is paying rent and nothing major in terms of maintenance/repairs has come up. The PM has been very good with communication with myself and the tenant. If things continue to go well, I am working to save capital for another investment with RTR towards the end of 2021. I would be happy to share more if you have specific questions!

Best Wishes!

Zach Lemaster · Answer

Hi @Saurabh Kukreja,

Thanks for reaching out.  I will say that it's important to always run your own numbers, but you do need to know why you are inputing specific numbers into your analysis.  I think you will find that even if you use a higher number for maintenance to be conservative the numbers still make sense, and it is not a deal breaker.  There is plenty of room for variance with ample cash flow.  We input data based on historical information that we see in performance.  Many of the new construction properties have comprehensive warranties for the first 1-2 years where you will have no maintenance, but we are still factoring it into the pro forma.  Some homes have lower %, and some have higher % much depending on the tenant.  These numbers are just starting points to get a general idea for performance.  Homes that are recently rehabbed, and especially the new construction, this would be a realistic estimate.  We do have many positive reviews with people openly talking about their experience and performance.  I think if people were not having a somewhat predictable experience this would not be the case.  I will let @Joseph Schweizer add in his personal experience as well.

Please don't hesitate to reach out directly with any other questions you have, and we hope to work with you in the near future to see firsthand how properties perform.  The first property is always the most daunting to get under your belt, but it is the most important to build your confidence to scale over time.  Scaling is the goal with anyone looking to build substantial passive income!  I hope this helps.

Joseph Schweizer · Answer

Hi @Saurabh Kukreja!

I have owned the property for just over a year now and the pro forma and my own expectations are very close to the actuals. I have not run into any major issues and things are going well. To address your issue with maintenance, even when I ran initial calculations with higher vacancy, maintenance, etc., the numbers still showed cash flow so I was comfortable moving forward.

Scott Lundgren · Answer

Lorene,We are not sure how to respond to this post.  You stated you did not buy through the RTR network, and then went on to mention you had issues with your property.  I don't think this should be a reflection on RTR if you did not purchase from our team in this area.  I'm sure everyone would appreciate it if you would be specific on exactly who you purchased the home from & who you are encountering issues with for transparency.  That is what these forums are for.  Otherwise I don't think this post is adding value to the BP community as a whole.  If you did not purchase through the RTR network, then this should not be a reflection in any way on RTR.  For the record, we have one contractor we work with in the KC market.  His name is Andrew Ross, and we have many clients that have had a great experience working with him for years now.  RTR is a licensed MO broker and has a very meticulous vetting process we follow for anyone that wants to join our network.  We have accepted less than 3% of the contractors/builders/brokers/sellers/property managers that want to join our TK network because they do not meet our standards.  A post like this is probably best on its own thread talking about the people/team you actually worked with in KC since it was not RTR.

Adam Sieg · Answer

Hi Hnu-

I've had a very positive working with Rent-to-Retirement and the owner Zach Lemaster.  After reviewing lots of positive feedback on the forums I reached out to Zach who responded very promptly.  We had our initial call and we were off to the races.  During our strategy session it made sense to purchase 3 properties, given our upfront capital, need for only one credit check and utilizing a preferred lender who secured low rates for all three properties.

Two of the properties have gone better than expected and have had next to no issues and barely receive communication from the PM company because there is simply no need.  The third property I've had some issues with specifically as it relates to the tenants paying monthly mortgage and how the PM has handled some situations.  Upon ongoing issues, I reached out directly to Zach who intervened almost immediately.  He was able to secure payment for some issues related to the house and helped get tenants to pay for rent.  Unfortunately, the PM continued to have issues so in discussion with Zach, we secured a new PM company which has been significantly better.  I don't believe R2R utilizes the original PM company due to some other issues.

Given those experiences, I decided to continue to use them as my preferred turnkey company.  I've secured an additional 3 properties in the Cape Coral area - all of which are new builds.  One is nearly complete, the other 2 are in their initial phases of construction.  If I had additional capital, I would definitely have bought more as the properties seem to continue to grow in value.

I would definitely reach out to Zach and his team and at least have an introductory call to see if they meet what you are looking for.  I've been impressed with my experience.

Happy Investing!

Lorene Kohleffel · Answer

Update: I want to clear up any confusion I caused with my last post.  I did not purchase my property through RTR, and the issues I encountered had nothing to do with them. The owner of RTR, Zach Lemaster, reached out to offer his expertise and assistance with the issues we were encountering even though this was not one of his properties. Honestly, he didn't have to do that and we really appreciate his willingness to assist.  I'm happy to say that we are headed in a better direction with the property after speaking with him and hearing his advice on the situation. It is clear that he cares about investors' success even for those not doing business with his company.  That goes a long way to show how he runs his company and team.  The next time we are looking to invest in a turnkey rental property, we will highly consider working with his team.  Thank you Zach!

Adam Sieg · Answer

Hi @Saurabh Kukreja -

I was definitely a little skeptical of the numbers that R2R was putting out with respect to their profroma.  Had many conversations with @Zach Lemaster prior to purchasing my first property.  Overall, I think you need to do what makes sense to you and what you are comfortable with.  I personally do 5% for both Maintenance and Reserve and CapEx.  I have a wife and kid to worry about and I'm a stay at home so don't want surprises.

One property Zach actually intervened when I reported an issue with the HVAC unit that was supposed to be replaced but wasn't.  I ended up cashflowing just under the proforma on that one but that was in relation to some issues with the tenants and always complaining about issues.  That weren't really issues.

My other 2 properties have far exceeded expectations.  proforma with those suggested about $200 per rental property and my year end cashflow was actually close to $2800 for one and $3100 for the other.

Lien Vuong · Answer

Best to read those posts and look for referrals of clients who have worked with him in the past to get a true experience and insight of their successes and shortcomings.

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