New Investor from CA looking at Indianapolis Turnkey

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New Investor from CA looking at Indianapolis Turnkey

Chris Gerenser
Investor 路 Napa, CA 路 Member since 2016 路 19 posts 路 5 votes

Hello BP Community!

My name is Chris Gerenser and I live in Napa, CA with my wife and three girls. We currently have one rental property, as we held onto the home we outgrew. We have been interested in acquiring more rental properties, but the cost of real estate in California is very high.

The high cost locally drove us to look into buy and hold investing out of area and that led me to Turnkey operations. This seems to be the best fit for my family since at this point we do not have the time to dedicate to developing a market and team ourselves. The first market we are looking into is Indianapolis with Clayton Morris. We have set up an LLC and are looking to do our first deal.

We would like to put a roadmap together to acquire SFR and potentially MFR over the next 5-10 years to grow passive income from rentals that are cash flow positive from the start. I have many questions that I will address in other threads, but if you have any input regarding this market or any tips for a new investor, I'd appreciate the information. Thanks!

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Phil DuChamp
Investor 路 Indianapolis, IN 路 Member since 2014 路 61 posts 路 28 votes
10y
Chris Gerenser I'm in the Indy market, just getting started and working with Norada Real Estate looking for my first property. While the COC isn't as favorable as Morris Invest, they have contacts with vetted rehabbers and property management firms. I'd recommend checking them out before committing to anything with Morris... I'm not trying to steer you one way or the other, just suggesting you keep your options open. I've been curious what area of town he's working in. At the price points he's mentioned on the podcast I'd think the area may be questionable...
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  • Kim Kinney
    Real Estate Investor 路 Danville, CA 路 Member since 2016 路 3 posts 路 0 votes
    10y

    We are in a very similar situation so I want to follow this thread (Dan and Kim from Danville, CA) 馃嵎

    0Reply
  • Ron Sharp
    Reno, NV 路 Member since 2016 路 7 posts 路 1 vote
    10y

    Hi Chris. We are in Reno and in a very similar setting. We are also looking at working with Clayton. Everything seems great. The one thing I have been thinking about is how and when to move the properties into the LLC.

    0Reply
  • Phil DuChamp
    Investor 路 Indianapolis, IN 路 Member since 2014 路 61 posts 路 28 votes
    10y
    Chris Gerenser I'm in the Indy market, just getting started and working with Norada Real Estate looking for my first property. While the COC isn't as favorable as Morris Invest, they have contacts with vetted rehabbers and property management firms. I'd recommend checking them out before committing to anything with Morris... I'm not trying to steer you one way or the other, just suggesting you keep your options open. I've been curious what area of town he's working in. At the price points he's mentioned on the podcast I'd think the area may be questionable...
    1Reply
  • Brian Naumann
    Mishawaka, IN 路 Member since 2016 路 25 posts 路 6 votes
    10y

    There is another thread about Morris invest if you are interested.

    https://www.biggerpockets.com/forums/92/topics/320061-morris-invest---any-insights

    Congrats to you all for taking that first step to building your wealth.

    0Reply
  • Andrey Y.
    Specialist 路 Honolulu, HI 路 Member since 2014 路 1k+ posts 路 1k+ votes
    10y
    Originally posted by @Phil DuChamp:

    Chris Gerenser I'm in the Indy market, just getting started and working with Norada Real Estate looking for my first property. While the COC isn't as favorable as Morris Invest, they have contacts with vetted rehabbers and property management firms. I'd recommend checking them out before committing to anything with Morris... I'm not trying to steer you one way or the other, just suggesting you keep your options open.

    I've been curious what area of town he's working in. At the price points he's mentioned on the podcast I'd think the area may be questionable...

    In doing your research, have you also considered the Kansas City, Atlanta, and Memphis markets? Cash flow seems comparable to Indy with better potential for appreciation in those 3. I am invested a bit into Indy REITs but also looking to diversify into other markets.

    0Reply
  • Chris Gerenser
    OP
    Investor 路 Napa, CA 路 Member since 2016 路 19 posts 路 5 votes
    10y

    @Phil DuChamp Thanks for the info.  As a new investor its great to know the options.  Not sure the exact areas but hoping to see details on available properties this week.

    0Reply
  • Chris Gerenser
    OP
    Investor 路 Napa, CA 路 Member since 2016 路 19 posts 路 5 votes
    10y

    @Andrey Y. No, I have not looked into the other markets.  Just starting and there is so much info out there!  Do you have any contacts that you are working with in those markets?

    1Reply
  • Andrey Y.
    Specialist 路 Honolulu, HI 路 Member since 2014 路 1k+ posts 路 1k+ votes
    10y
    Originally posted by @Chris Gerenser:

    @Andrey Y. No, I have not looked into the other markets.  Just starting and there is so much info out there!  Do you have any contacts that you are working with in those markets?

     Not yet. But will let you know when I do. Let me know if you learn something!

    0Reply
  • Ali Boone
    Real Estate Coach 路 Venice Beach, CA 路 Member since 2012 路 6k+ posts 路 3k+ votes
    10y

    Hey Chris! And @Kim Kinney too.

    I've always bought turnkeys and have worked with them for the last five years. Happy to help in any way I can. 

    I know of some experts out there that are actually "portfolio strategists"....they specialize in exactly what you are asking--preparing a buying plan and strategy plan for getting into turnkeys. The main guy is one of my personal mentors. Happy to share him if you want. 

    But general advice, I'd say to plan ahead, learn due diligence, learn/decide who to work with (what makes the best turnkey companies), and read lots of my articles on the blogs :) I've done a lot about turnkey stuff. Feel free to ask any questions!

    0Reply
  • Kim Kinney
    Real Estate Investor 路 Danville, CA 路 Member since 2016 路 3 posts 路 0 votes
    10y

    Thanks @Ali Boone  I have read several of your articles and you are surely in the know.  A  real wealth of knowledge :).  Have also subscribed to your newsletter. We actually signed closing papers last Friday for a rental home in Indy.  We worked with a broker from Northern California who is active on this site. If you have info to share or direction on persons who can assist, I'd love it.  Feel free to private message me (and I'll try to figure out how to retrieve as some of these links and threads are a bit foreign to me...a real newbie!)

    Best Regards,

    Kim

    0Reply
  • Ali Boone
    Real Estate Coach 路 Venice Beach, CA 路 Member since 2012 路 6k+ posts 路 3k+ votes
    10y

    @Kim Kinney haha, no worries...I've been on this site for years and some of it is still foreign to me as well! I'll send you a message.

    0Reply
  • Bill Manassero
    Rental Property Investor 路 Mission Viejo, CA 路 Member since 2014 路 230 posts 路 113 votes
    10y
    Hi Chris Gerenser I am from California, too, and have been investing in Indianapolis for a few years - all MFR -- and would be happy to chat with you. I also have experience with turn-key companies there. Feel free to send me a message and I'll share what I can. Bill
    0Reply
  • Marco Santarelli
    Specialist 路 Orange County, CA 路 Member since 2008 路 2k+ posts 路 623 votes
    10y

    Welcome to BiggerPockets @Chris Gerenser!

    "the cost of real estate in California is very high" is largely an understatement.  The affordability ratio here is so high that you can do far better in other (prudent) markets...

    Indy is one such market that we really like, and have been involved in for almost 8 years now.

    It's a great place to start your portfolio, or expand your portfolio.  The numbers make sense, and the local economy is sound.

    I look forward to seeing your other questions in the forums.  I'm sure you have some of the many frequently asked questions I see/hear from Californians (and other out-of-state investors).

    Continued success!

    0Reply
  • Marco Santarelli
    Specialist 路 Orange County, CA 路 Member since 2008 路 2k+ posts 路 623 votes
    10y

    @Kim Kinney -- Welcome to BiggerPockets!

    Jump in and ask any questions you like.  See you around the forums.

    Continued success!

    0Reply
  • Nadine Lajoie
    Investor 路 Long Beach, CA 路 Member since 2015 路 201 posts 路 29 votes
    10y

    I invested in many SFR in Indy, and others in IL and GA, so I can help answer few questions as well... I did fix and flips and some buy and hold, lease-option and rent-to-own, never saw one of my deals Out-of-States, so contact me if you wanna talk. Plus I found a group in December who can do 3 houses for $50k, with a turn key for lease-option buyers, you can still do the flips in between if you want too... many ways... many strategies. Glad to help!

    0Reply
  • Nadine Lajoie
    Investor 路 Long Beach, CA 路 Member since 2015 路 201 posts 路 29 votes
    10y

    I invested in many SFR in Indy, and others in IL and GA, so I can help answer few questions as well... I did fix and flips and some buy and hold, lease-option and rent-to-own, never saw one of my deals Out-of-States, so contact me if you wanna talk. Plus I found a group in December who can do 3 houses for $50k, with a turn key for lease-option buyers, you can still do the flips in between if you want too... many ways... many strategies. Glad to help!

    0Reply
  • Phil DuChamp
    Investor 路 Indianapolis, IN 路 Member since 2014 路 61 posts 路 28 votes
    10y
    Originally posted by @Chris Gerenser:

    @Phil DuChamp Thanks for the info.  As a new investor its great to know the options.  Not sure the exact areas but hoping to see details on available properties this week.

     Let us know!  I'd love to drive by and check them out!

    0Reply
  • Chris Gerenser
    OP
    Investor 路 Napa, CA 路 Member since 2016 路 19 posts 路 5 votes
    10y

    @Nadine Lajoie @Marco Santarelli @Bill Manassero @Ali Boone and others,  thanks for the help and the offers.  I will take you up on them. What are some of the things I should look for when analyzing my first deal?  Being out of state I'd love to hear what the best resources are to be able to tell how my deal stacks up.

    0Reply
  • Nadine Lajoie
    Investor 路 Long Beach, CA 路 Member since 2015 路 201 posts 路 29 votes
    10y

    All online like Trulia, Zillow, Redfin at first, even if they are not 100% accurate, I put that in my software and can analyze 8 deals in 2 minutes... once I got the deal I feel confident, call realtors, get MLS , tax assessor, insurance, utility companies, and send contractors for quotes when they can access the house...

    0Reply
  • Jamie Henkin
    New to Real Estate 路 Cardiff By The Sea, CA 路 Member since 2016 路 49 posts 路 29 votes
    10y

    Alie thanks for your post.  I'd love to know more about your Portfolio Strategist. I'm new to investing and a mentor would be such a great help.  I lived in Venice too!

    0Reply
  • Ali Boone
    Real Estate Coach 路 Venice Beach, CA 路 Member since 2012 路 6k+ posts 路 3k+ votes
    10y

    @Jamie Henkin sure thing! Just saw your message, will respond to you there. And ooh, Venice, nice! :)

    0Reply
  • Ali Boone
    Real Estate Coach 路 Venice Beach, CA 路 Member since 2012 路 6k+ posts 路 3k+ votes
    10y

    Chris, well...that's a bit of a loaded question :) Lots of stuff you can look at. I would first and foremost always look at a few different companies before pulling the trigger with just one. That's a good way to start comparisons. Then I'd also make sure you are swift on the numbers. Like if anyone tries to convince you of a return that doesn't include estimates for maintenance or vacancies, they are fluffing the numbers. Then there's financing--make sure you are working with an investor-friendly lender. Learning due diligence on a turnkey isn't hard but you want to learn that one. 

    None of that is probably helpful, but I can talk in more details about any of them and I have articles on here about each one. Happy to answer any specifics!

    0Reply
  • Account Closed
    Investor 路 Honolulu, HI 路 Member since 2013 路 3k+ posts 路 1k+ votes
    10y
    Originally posted by @Marco Santarelli:

    Welcome to BiggerPockets @Chris Gerenser!

    "the cost of real estate in California is very high" is largely an understatement.  The affordability ratio here is so high that you can do far better in other (prudent) markets...

    Indy is one such market that we really like, and have been involved in for almost 8 years now.

    It's a great place to start your portfolio, or expand your portfolio.  The numbers make sense, and the local economy is sound. !

    Marco, can you explain how the high affordability ratio  allows you to do far "better" in other "prudent" markets?

    And what "numbers" make sense in Indy?  The numbers on your web site on properties in INDY do not make sense and you refuse to explain them in other threads where I have asked.

    Like here,  Can you detail all the operating expenses used to calculate Net Operating Expense?  Geez, looking further you come up with a 6.3% cap rate vs the 7.9% cap rate stated here.  I don't see how either of those numbers make "sense"!

    Rental Income:$900
    Bedrooms:3Property Tax:$140
    Bathrooms:1.5Insurance/HOA:$60
    Size: (sq ft)1,618 Property Mgmt:$72
    Price/Sq foot: $59Cash Flow: (Raw)$628
    Year Built:1920Cap Rate: 7.9%
    1Reply
  • Nadine Lajoie
    Investor 路 Long Beach, CA 路 Member since 2015 路 201 posts 路 29 votes
    10y

    Hi Chris, tried to call you back but number didn't work.  Please feel free to call me tomorrow after 4pm PST or Sunday in afternoon.  Should work at my new condo and can talk few minutes, unless you can come and visit! 

    0Reply
  • Robert LindsleyPro Member
    Real Estate Investor 路 Orlando, FL 路 Member since 2016 路 185 posts 路 53 votes
    10y

    @Nadine Lajoie Can you share what software you're using?  I use Freedomsoft to analyze my deals but it's not very automated.  I'd love to find a quicker way!

    0Reply
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