All Forum Posts by: Cj Powderhorn

@Deisy P. Sounds like you have had a tough time! I think you've pretty much heard it all on here already.

I bought my first home at 22 (completely on my own) and have also always worked in very male dominated fields.  I only have about 10 homes but they are all homes that I have bought on my own (it seems like you are looking for women who have done this without a male mentor or partner).

With my investment properties the key has been MY TEAM.  I'm not going to classify it as male/female but I am more comfortable having my team take care of getting multiple bids, telling the contractors when they don't do a good job, and dealing with late payments from tenants.  However, I do feel my strengths of loyalty, compassion and empathy have helped develop a successful (somewhat) portfolio and I have been able to work with the same team for about 15 years. 

I am looking into some new areas and it is going to take some work to find people that I trust and that share the same values that I want in my business (everything from not charging application fees, rental rates slightly below market and if/how/when/why to evict someone). I do have a partner now and he and I differ on our real estate strategies which just gives us some diversification.

People who want to lie, steal, or take advantage of you are going to do that anytime they can get away with it-to anyone.  You can't take it personally.  Also, the same with the comments from various contractors, etc.  That is their problem, not yours.  

If it's something you really want to do, think about continuing just to surprise people with your success! 

@Chris Clothier Thanks so much for the response!  

What are your thoughts on the increased (?) work options with the Amazon and Nike businesses? What did you see rents drop to in the last downturn in these areas?  Also, any thoughts on 38107?  Where do you see the 'next' Memphis, if there is one in this current market?

Thanks, 

Cj

@Timothy Lewis- your response makes much more sense... in your first email you mention, 

'Areas to avoid:

• Frayser 38127
• Orange Mound 38114
• North Memphis - 38107
  South Memphis - 38126, 38106'

I actually think some of these are probably the only areas for new investors to start with in Memphis, as the returns may still work.

@Michael Quarles I would love to see your list as well. I'll connect with you as a fellow Memphis investor. Thanks!

@Timothy Lewis I'm curious about your opinions on 38127 and 38107?  I have several homes in each of these zipcodes (as well as some others) and am looking at getting a few more there.  I started investing in Memphis when I lived there (about 12 years ago) and now invest from Utah.  I am actually surprised by the number of calls I get to sell my homes in 38127, 38107, 38109 and 38104. As I've been in these areas for a long time, maybe it is different - I know that the numbers are but I also have had long term tenants in most of my properties.  Thanks!

@Dean Harris I LOVE your podcast - curious as to your opinion regarding different areas mentioned in the above post? Thanks!

@Michael Quarles I would love to see your list as well. I'll connect with you as a fellow Memphis investor. Thanks, Cj

Hi, does anyone else have any recent experience with Spartan?  Or comparision shop them against other TK? Are they actually a TK or more like a Marketplace?  Thanks, Cj

Roofstock has some great opportunities. However, it is not a TK site. It is a 'marketplace'. That is an important distinction.  I shared the following with another 'new investor and TK post'

I believe once you ask all of your questions and feel like you have valid answers you should take a step back and decide if you are willing to trust the operator.

True TK operators like Chris Clothier above will (usually) price homes fairly based on what they have put into the property. I assume that they will make more on some properties and less on others. However, their goal, especially now, seems to be multiple properties for each investor, investor satisfaction and referrals. They have a vested interest in helping you achieve your goals unlike some other arenas based on commission only.

Make sure that the price reflects what the rent actually is - not projected! I mention 'is' because many reputable TK companies will not sell the home until there is a renter in it. Some companies, will offer a 3-6 month 'rental compensation' if the home isn't rented. Is this a good deal? In my opinion, no because you don't really know what the true rent will be, the home will probably sit vacant and there is no way to see how your chosen PM will do. Plus, WHY buy that home instead of one that is rented (other factors being comparable). Sometimes you can find a better deal on these sites but if you are OOS, you will need a solid team from day 1.

Many of these 'Marketplace' vendors have entered the TK arena(if you are unsure of these companies, just search the forums). They are not TK operators. To me, there is the 'holy trinity' of True Turnkey all under one umbrella - 1. The TK company actually has possession of the home and it's OWN rehab/mx crew has rehabbed the home and a renter is in it with a signed contract and actual monthly payment 2. The PM is under the same umbrella and you agree with their policies as a landlord, as well as how they find/vet/treat tenants and 3. The same people who rehabbed the home will provide ongoing repairs and mx (within reason). These are all important as is the exhaustive list of questions that Chris provided above. For example, the TK company I have used in Memphis does not charge an application fee to potential tenants, rents the properties for slightly below market value, and is understanding (both pre-covid and now) if tenants have an issue paying the rent. This model has worked very well, for me as I have had my renters in my homes for between 5 and 8 years, and have been lucky to continue to collect rents thru the summer.

One thing that I believe new investors seem to miss about the TK system is if you have received solid answers and a few good references (especially from investors with multiple properties) you either trust them or you don't. You agree with their pricing, once you run your own numbers or you look for something else. I am not sure how much I have saved from having very limited turnover but I know it is more than the few thousand dollars I may have saved by going with a 'cheaper' home by a provider who doesn't get the big picture.

Finally, ask ask and ask away while you are interviewing a TK company, but once you have made a decision, let them do the job you are paying them a premium to do! If you want to pick flooring, paint colors, landscaping, be involved with vetting tenants and changing contracts, setting rent, etc--you should do it yourself! You are paying for THEIR expertise in how to rehab the home for the area, how much to charge and THEIR experience in picking tenants. If you really want to be involved in everything, you probably should consider something other than TK. I have not ever been inside ANY of the multiple homes I have purchased thru the TK provider I choose to work with.

I'm just an investor but I am surprised by the time and patience many of the TK providers show on this site. They are really trying to educate us about the process and we can support them by listening and understanding what their role is as compared to some of the more recent options. Neither option is good or bad but as a new investor you may want to decide ahead of time just how passive you want to be. Good luck :)

@Tanner Shore I believe once you ask all of your questions and feel like you have valid answers you should take a step back and decide if you are willing to trust the operator.  

True TK operators like Chris Clothier above will (usually) price homes fairly based on what they have put into the property.  I assume that they will make more on some properties and less on others. However, their goal, especially now, seems to be multiple properties for each investor, investor satisfaction and referrals. They have a vested interest in helping you achieve your goals unlike some other arenas based on commission only.

Make sure that the price reflects what the rent actually is - not projected! I mention 'is' because many reputable TK companies will not sell the home until there is a renter in it. Some companies, will offer a 3-6 month 'rental compensation' if the home isn't rented. Is this a good deal? In my opinion, no because you don't really know what the true rent will be, the home will probably sit vacant and there is no way to see how your chosen PM will do. Plus, WHY buy that home instead of one that is rented (other factors being comparable).  Sometimes you can find a better deal on these sites but if you are OOS, you will need a solid team from day 1.

Many of these 'Marketplace' vendors have entered the TK arena(if you are unsure of these companies, just search the forums). They are not TK operators.  To me, there is the 'holy trinity' of True Turnkey all under one umbrella - 1. The TK company actually has possession of the home and it's OWN rehab/mx crew has rehabbed the home and a renter is in it with a signed contract and actual monthly payment   2.  The PM is under the same umbrella and you agree with their policies as a landlord, as well as how they find/vet/treat tenants and 3.  The same people who rehabbed the home will provide ongoing repairs and mx (within reason). These are all important as is the exhaustive list of questions that Chris provided above.  For example, the TK company I have used in Memphis does not charge an application fee to potential tenants, rents the properties for slightly below market value, and is understanding (both pre-covid and now) if tenants have an issue paying the rent.  This model has worked very well, for me as I have had my renters in my homes for between 5 and 8 years, and have been lucky to continue to collect rents thru the summer.

One thing that I believe new investors seem to miss about the TK system is if you have received solid answers and a few good references (especially from investors with multiple properties) you either trust them or you don't.  You agree with their pricing, once you run your own numbers or you look for something else.  I am not sure how much I have saved from having very limited turnover but I know it is more than the few thousand dollars I may have saved by going with a 'cheaper' home by a provider who doesn't get the big picture. 

Finally, ask ask and ask away while you are interviewing a TK company, but once you have made a decision, let them do the job you are paying them a premium to do!  If you want to pick flooring, paint colors, landscaping, be involved with vetting tenants and changing contracts, setting rent, etc--you should do it yourself!  You are paying for THEIR expertise in how to rehab the home for the area, how much to charge and THEIR experience in picking tenants. If you really want to be involved in everything, you probably should consider something other than TK. I have not ever been inside ANY of the multiple homes I have purchased thru the TK provider I choose to work with.

I'm just an investor but I am surprised by the time and patience many of the TK providers show on this site. They are really trying to educate us about the process and we can support them by listening and understanding what their role is as compared to some of the more recent options. Neither option is good or bad but as a new investor you may want to decide ahead of time just how passive you want to be.  Good luck :)

Sent a PM

@Sara Waters I think a big factor is how much you want to spend.  I've had investment properties in NC, SC, HI, CA, TN and UT. Currently am in all markets above except HI. I'm now looking at Cleveland and Jacksonville.

 I started in Memphis about 12 years ago and it is my favorite. I believe that is due to my TEAM.  I did start with a TK company that has been fantastic and also have 2 other PM's I work with now, due to the locations of the properties.  Quite a few people on here push for only investing in 'B class' and I'm sure the statistics support that on a large scale. However, I updated my property spreadsheet this weekend and out of seven C and C- properties (38125,38127,38114,38106,38108, 38115) SIX have had the same tenant for more than 5 years!  That is again, due to my TEAM. There have been average maintenance costs and one roof replacement due to a windstorm but no graffiti, gunshots or meth house issues. I also haven't had any rent losses during this time (hopefully, will continue once the subsidies are gone).

  I'm just sharing this perspective as everyone comes into this with different priorities and more importantly with different amounts to spend. You want to make sure you have a healthy reserve, especially just starting out. Happy to connect via PM and share my story. Good luck!