Hey all - I did an update on my Turnkey Portfolio for 2016 here: https://www.biggerpockets.com/forums/311/topics/40...

and it was a big hit so I figured I'd do it again for 2017! NOTE: I own OTHER properties that are NOT Turnkey including everything from SFR to Commercial, BUT this is JUST to discuss my Turnkey portfolio specifically. I do this because there are so many questions about TKs for beginning investors so I thought it would be good to go through this and answer any TK specific Qs that anyone has.

I own Tks in 2 markets, Indy and KC. One of the ones in KC I sold so I am leaving that one out altogether.

All of them were purchased with 70-75% LTV.

Indianapolis properties - I bought ALL of these properties in mid - 2015, at the end of 2017 I did a cash out refi and the property values had gone up about 25% across the board in appreciation. That roughly equates to what I had down + closing costs in to buy these properties! I hear a lot about turnkey and appreciation - BUY IN A NEIGHBORHOODS that are close to the median house price!

Cash on Cash returns

Property A - 5% (Had a turn that cost one month rent, one month in lease up fees, and then almost another month rent in the turn as this tenant lived there for almost 3 years.)

Property B - 27%

Property C - 18%

Property D - 17%

Blended CoC - 16%

IRR (For the sake of this, just cash on cash + principal paydown (before the cash-out refi's) went into this calculation)

Property A - 10%

Property B - 33%

Property C - 22%

Property D - 21%

Blended IRR - 21%

Factoring a cash out is always tough where to place it when looking at returns, yearly the returns would come out to 41%, 73%, 105%, and 100%, but really, with the money I've made and taken out I've already made back all of the money down into my pocket and then some so over 100% cash on cash overall.

The crazy thing about the refi was that not only did I take money out, but the amount my payment increased over 30 years is LESS than what I took out due to lower interest rates now.

Kansas City Property - 

Cash on Cash - 3%, IRR with above metrics - 7% - This property is the most expensive TK I've ever bought, it's a nice property with low issues, but once a turn hit, the property just took a while to rent back out.

Turnkey isn't exactly TURNKEY and PASSIVE like everyone thinks. Due diligence is really important and it still takes some tracking and staying on the PM to make sure everything is done properly. There is NOTHING more important than your feet in the street when buying turnkey and the PM you use. For that reason alone, my investing strategy for 2018 includes only buying more in Indianapolis at this point with most or all of it being turnkey (that of course could change.)

And please, don't try to get rich quick, slow and steady is the best way to do it, don't get burned on a D grade property from across the US that you bought for $40K and rents for $700/month and think you won't have issues and will become a millionare over night.

If any property or TK specific questions, please ask away!