All Forum Posts by: Hank Keller

@Fernando E. - I use a TK provider in Indy and purchased 2 more last year. One was $53k and the other $70k. The cheaper house is in an area called 16tec and it is where i bought my very first house from the provider 5 years ago @$46k on the same street about 6 doors down. Appreciation will depend on the neighborhood and in my case, Indy has spent millions revitalizing this area to bring in new companies. Can’t go wrong with that...

@Jon Passow - i live an hour north of columbus and have 1 SFH in Columbus (partnership), 7 in Indy and 1 in Charlotte (turnkeys) all of which are purchased through IRA's. All are performing well; right now, my best returns are coming from Indy and highest appreciation coming from Charlotte. The taxes being higher here in ohio compare to Indy is the biggest difference. Columbus property was purchased in 2011 and has turned over twice with minimal maintenance in a C+ neighborhood (Linden). Even though i live a hour north of columbus i have been doing most of my recent purchases OOS because of the team i've used.

@Kulin Dakwala - I’ll PM you...

Hank

@Ken F. - Having 6 TK's in Indy, I'd say your analysis is very good, at least from a 50K foot level. Population growth, jobs, business friendly and cheap houses are the criteria I start with but then it's good to go to the neighbor level because that's what can make or break your returns. the guy I use reads the monthly city meeting minutes and invests in the low B neighborhoods but doesn't rehab until the city has brought the values up in the neighborhood so appreciation can be significant. I believe that a cities credit rating is very under rated and is where Indy shines. He also operates out of Kansas City, Charlotte & Dallas. 

Hank 

@Lane Kawaoka - So sorry to here that. I've had a similar issue though not close to that extent. My response to my TK company was to increase the inspection frequency. we'll see how that goes...

@Ellis Hammond - Invest where the numbers make sense. I have a youth pastor friend in a similar situation to you and he was able to buy a duplex, live in one side and rent the other. Once he learned about being a landlord and got some real world experience, he was able to increase his portfolio by finding good deals. If your market doesn’t get you rents that equal at least 1% of the purchase price, you should look elsewhere. As Lane mentioned, turnkeys could be a good alternative. Always better to start local if the numbers make sense and you’ve got someone who can mentor or walk along side you for your first few deals...

@Mark Niemamn - As others have said, read the threads and do your due diligence. My recent TK purchases are in the mid 60's in low to mid B neighborhoods. Ive had some maintenance and evictions. returns are in the mid 7% but other than reviewing monthly reports are completely passive allowing me to grow my retirement funds while concentrating on my local market. it can be done but with thorough due diligence.

@John Chung - the first time I purchased an out of state property, I drove to visit the city, meet the team and inspected the houses prior to purchasing. Prior to going to the city complete your due diligence on the population, jobs, housing costs and city or state business environment and credit rating... let me know if you need more help!

Hank

@Eric Martin - I've been in the same situation. With a full time job I bought local but got to the point where I couldn't do any more working at the same time. Ended up going Turnkey in Indianapolis and over the past 5 years have purchased 8 with great results. Here's four things to look for when researching a market:

1- Population over a million and good growth rate. This ensures that there are plenty of available houses (with an approximate 3% foreclosure rate, there are about 3000 houses at auction each month), renters to choose from and that the city is growing rather than stagnate or losing population. Good markets didn't drop during the 2008 crash...

2- Cheap Houses. Make sure you get at least the 1% rule meaning $1000 of rent for each $100k of purchase. This should also ensure youre getting about 8% return on your money.

3- Business Friendly and Credit worthy State. Look at how easy it is to set up an LLC, the costs of maintaining the business and the cost and timing of evicting a tenant. Also look for states and cities that have a good credit rating which ensures that they will be pouring money into revitalization which increases jobs, growth, appreciation and rents.

4- Jobs. Look for cities where there is a good mix of manufacturing, warehousing and overall good job market with low unemployment. it also ensures that taxes won't go up in the event that a city starts going bankrupt. (http://www.zerohedge.com/news/2017-10-05/these-two-charts-depict-which-cities-will-file-bankruptcy-next) 

Hope that helps...

@David Carbajal - similar to Ali, I have not heard of any in Raleigh. I do have 1 in Charlotte. let me know if you find any.