Top 3 things to look for in deciding a Turn key property

[Buyan Thyagarajan]

Hi Guys,

I am in the process of purchasing a property from a turnkey provider in Memphis Tennesse. These are single-family homes where I found the price points the same, price per square foot almost the same and the provider sent me pictures of the rehab and project work. Could you tell me the top 3 criteria I should look for in deciding the property?

Buyan

[Cherie Ganesh]

In addition to Curt's comments, you need to get a good handle on what a realistic rent is for the specific property. There is a large variance in market rents throughout the greater Memphis area which means you may need to pay for a market analysis if you don't have a way to determine that. There are turnkey houses on the market that have a list price higher than what rents in those areas will support. Make sure you have confirmed all holding costs yourself and plug in an increase in both city & county property taxes that will occur most likely the year after you close on your purchase. Lastly understand the demographics for the area surrounding your potential investment so you can create a correct risk analysis and how much rehab you may have to do when tenant leaves.  Hope this helps.