Originally posted by @Tom J. :

Unfortunately no promising update...I contacted the PM company few more times (by phone and email).  Someone got back to me and said that they are still working on it and gave pretty much no details.  The property is not fully cash flowing yet.  Not sure how this is going to turn out long term.  There are multiple TK companies out there.  If you are considering investing and decide on this one, just realize what you are getting into.  Perhaps they are growing too fast to be able to handle the demand or they are just figuring things out as they go.  Either way, not a great situation for someone wanting true "turnkey" investing.

Could you share some more details please. Have you already closed escrow? How much did you purchase the property for? What is the expected ROI after expenses?

If the individual I purchased the property from, who also happens to control the rehab and management, was not answering emails I'd be ticked and try to pull out of the deal.

These are low cost properties...relative speaking. So there isn't escrow and all. U pay the cost and rehab up front and then they rent it out after rehab is complete. Purchased for around $50k. Rent is supposed to be $700 per month. 10% PM fee on gross rent. Tax and insurance is around $600-800 per year. Expected ROI, net of all expenses is supposed to be ~$7000 per year on a $50000 property so ~14-15% is the expected cash return (not accounting for vacancy). That is the attraction because that is the UNLEVERAGED return. Leverage would amplify that return but they don't deal with anyone that needs a loan to purchase so that's something to be aware of if you consider going with them.

@Tom J.

Hi Tom, if you want leverage (financing) some lenders do loan on properties sub $50-$60k.

I prefer financing, as it increases your cash on cash return, and I like to carry mortgages (especially at today’s low rates) because I like loan balances that my wonderful tenants pay down ;)

I totally agree with you and I do use leverage for other larger properties that I've purchased. It just so happens that with these guys, they don't deal with people that need financing...which in this case, if things had worked out the way they were supposed to, I would've been getting like a 14 or 15% unlevered return.  I have thought about taking out the equity with a heloc but not really thinking that would be a good idea since this whole thing hasn't panned out the way that it was advertised. 

I had my call with them back in October (spoke to James). My brother turned me on to their podcasts (which I still think are helpful). James seemed very helpful and answered my questions to the best of his ability I think. He told me they were about a 4 man team that does the initial phone calls. I think James was based out of Boston. In the end the whole thing just felt very rushed to me. He told me that properties were going very fast (within 30 min) and because of that they were only working with cash buyers. I asked him a host of questions including who would eat the rehab overrun costs if there were any. He said that they would eat them because they want my repeat business. Not just 1 deal but 10, 20, etc.

Being a brand new investor I am just very uncomfortable buying my first property sight unseen within 30 min of learning about its existence. I’d rather shop in my backyard (San Antonio) where it’s close by.

The overall impression I got was that they are underwater and struggling to meet the demand. I know some on this post ascribe more nefarious intent to them (which at the end of the day may be true) but I’m just not there yet. I think they definitely need to staff up and work on the communication for sure.

I hope this helps!

@Ryan O'Donnell

I’ve had the experience of rehab costs overrunning the budget-not fun in terms of money and time.

Although many people on this site poo-poo turnkey properties, one big benefit to them is you purchase a finished product with all-in price. 

Just make sure prior to any purchase that you throughly vet any provider that you deal with!

It appears Clayton/MorrisInvest are now pursuing funding via a crowd-funding platform (https://www.realtyevest.com/deals). I have not had the best of luck with realtyevest and and trying to exit my investments with them. 

The latest in case someone missed the other thread(s). 

https://www.usatoday.com/story/news/investigations/2019/03/26/fox-and-friends-clayton-morris-investment-real-estate-scheme/3275317002/

Just google Clayton Morris there are about a dozen stories now.  It looks like the end is near for this joker.

@Robert Shelton

This came out recently: https://www.google.com/amp/s/boingboing.net/2019/07/15/hoosier-hotshot.html/amp