All Forum Posts by: Melissa Justice

Quote from @Reed Lederman:

@Melissa Justice I have a call set up with your service in a coup weeks. Looking forward to what you guys have to offer. Curious if you also do property management for the properties you sell or if you just facilitate the deals and then are hands off from there. I was looking at some of your calculations and it wasn't super clear if property management wasn't included in calculations because of a "deal" you were offering for 1 year free PM or if it wasn't factored in because you're assuming the buyer will self manage. 

That’s a great question — and thanks for setting up a call, excited for you to learn more!

With Rent To Retirement, we do not self-manage the properties we offer, but we partner with vetted local property management companies in each market. Our role is to facilitate the deal and help you build your team — so once you close, you're connected with a PM that knows the property and area well.

Regarding the calculations: typically, property management fees are factored into the pro formas, usually around 8–10%. However, in some cases where we’re offering a promotion like the first year of free property management, the numbers may show a temporary boost in cash flow. That’s why you might not have seen a PM fee in those particular examples.

Your investment counselor, @Lars Kappler can walk you through the numbers line by line and clarify what’s included. Best of luck!

@Ven Perla,

Hey Ven – welcome to the BP community and congrats on diving in! You're doing exactly what so many successful investors do: educating yourself, getting clarity, and taking intentional steps.

You're looking in some really solid hybrid markets that balance cash flow with long-term growth — and you're right to consider turnkey rentals as part of your strategy, especially with reliable PM in place. Companies like ours at Rent To Retirement actually specialize in exactly the type of markets you’re targeting — Huntsville, Ocala, parts of Texas — with new builds and fully rehabbed properties ready to go with tenants and management in place. That can make your first out-of-state investment much smoother.

As for Indiana/Ohio — South Bend, IN and Akron, OH are both strong considerations. South Bend has Notre Dame, consistent rental demand, and investor-friendly zoning. Akron is stable with solid rent-to-price ratios, and both have turnkey options available.

Happy to connect more and walk through recent deal examples or help you narrow down the right market fit. You’re off to a strong start!

Wishing you much succcess!

Melissa Justice

Investment Strategist

@Mark Morosky,

Hey there — I’m in Michigan too! 👋

It’s not crazy at all to invest out of state for your first property — plenty of investors do it successfully, especially when they live in markets that don’t cash flow well or have high barriers to entry. The key is building a solid “Core 4” team: agent, lender, property manager, and contractor (if rehab is involved). That team is what turns an out-of-state property into a manageable investment.

Turnkey properties are a great way to ease in — especially if you're working full-time or want less hands-on involvement. Providers like ours at Rent To Retirement offer fully renovated or new construction rentals with tenants and property management already in place in strong cash-flow markets.

Happy to compare a few cities or help point you in the right direction!

Best of luck,

Melissa Justice

Investment Strategist

@Reed Lederman, First off, huge respect to you for balancing a dental practice, fatherhood, and now diving into real estate investing—your plate is definitely full, and it sounds like you’re approaching this with the right mindset. Given your limited time and desire for a more passive approach, you’re absolutely on the right track looking into out-of-state, property-managed rentals in Class B neighborhoods. They tend to offer a great balance of stability and cash flow. Since you already have some foundational experience through your parents, you’re ahead of many first-timers. If BRRRR interests you but you’re concerned about the time commitment (rightfully so), you might consider a more turnkey route for your first couple of deals—ideally in markets where the property manager, lender, and contractor are all aligned. That way, you can learn the systems and build confidence without spreading yourself too thin. I’d be happy to share what I’ve learned from my own investing journey and help you navigate your first deal. Wishing you the best on this next chapter! Melissa Justice Investment Strategist at Rent to Retirement

Hey @Benjamin Pena,

Welcome to the world of real estate investing and BP! 🎉

Some of my simple newbie tips:
Get clear on your goals — cash flow, appreciation, or long-term wealth?

Pick a strategy — turnkey rentals, house hacking, BRRRR, etc.

Choose a market — look for landlord-friendly states with strong rent-to-price ratios.

Build your team — agent, lender, property manager, and contractor (if needed).

Take action — analysis is important, but progress comes from doing!

You don’t need to know everything to get started — just enough to make your first smart move. You've got this! 💪

Wishing you much success,

Melissa Justice

Investment Strategist at Rent to Retirement

@Felix Sharpe hey!

Congrats on being so close to Door No. 2 — that’s a big step forward! Based on what you’ve shared, a few thoughts:

A 7%–9.5% cash-on-cash return on new construction is quite solid, especially in today’s interest rate environment. New builds generally mean:
Lower maintenance costs

Fewer surprises

Attracts quality tenants

Better depreciation/tax benefits (especially if cost segregation is done early)

So from a deal standpoint, it sounds like you’ve found something worth considering — particularly if it’s in a landlord-friendly, high-demand market.

On Borrowing from the 401(k)- This can be a smart short-term play if you’re disciplined. 
Pros:
You’re paying yourself back with interest.

You avoid taking on high-interest debt from banks.

You’re leveraging money that might otherwise be idle or underperforming.

If you repay within the timeline, there’s no tax hit or early withdrawal penalty.

Cons:
You’re taking that money out of the market temporarily (opportunity cost).

If you leave your W-2 job for any reason, that loan may become due faster.

It's important to factor in the repayment plan and ensure the rental cash flow doesn’t get too tight.

If this property is through a turnkey provider that includes property management, rehab, and tenant placement — like us at Rent To Retirement — you’re mitigating a lot of the risk of surprises. That adds a safety net when using funds like your 401(k).

Since you plan to repay the loan in a year, and the property cash flows with a strong return, I’d personally lean toward yes — as long as you're confident in the stability of your W-2 and the market fundamentals of where you're investing.

Wishing you much success!

Melissa Justice

Investment Strategist

Hey @Sarah Patel,

Welcome to the BP community!

First of all—kudos to you both for even thinking long-term and strategically while juggling family and demanding W2 jobs. That mindset puts you ahead of the game. Now, to your question: Is it worth investing out of state if you’re new and busy with life? The short answer is: Yes — if you go turnkey.

Given your situation — full-time work, toddler, another baby on the way — trying to self-manage a short-term rental, especially in a heavily regulated area like Chicagoland, can quickly become overwhelming. That’s where turnkey properties come in. These are fully renovated, professionally managed rentals that are ready to go from day one. You buy it, and the cash flow starts while your life goes on.

How Turnkey Investing Solves Your Concerns -
Hands-off management: You get property management built in — no coordinating repairs or finding tenants.

Remote-friendly: You don’t have to visit the property to manage it. Everything can be handled digitally with regular updates from your team.

Done-for-you team: The “core four” (realtor, contractor, PM, lender) is already in place.

Cash flow from day one: Many turnkey providers focus on cash-flowing markets where returns are stronger than high-cost areas like Chicago.

More scalable: Once you own your first turnkey rental and see it working, you can repeat the process with confidence — even while raising a family.

If you’re thinking of investing out of state, markets like:

South Bend, IN (just a short drive from you)

Memphis, TN

Akron, OH

Locust Grove, GA

These areas are popular among investors for their affordability, stable rental demand, and landlord-friendly laws — and turnkey providers are already active there.

Short-term rentals (STRs) sound exciting, but they require constant attention, reviews, guest communication, pricing adjustments, etc. That’s a part-time job on its own. With turnkeys, you start with long-term tenants, professional management, and passive income — which seems like a better fit for your stage of life.

You're absolutely right to be thinking about tax strategy. If the bonus depreciation changes return under the current administration, it could enhance the upfront tax benefits on new acquisitions — especially on turnkey new construction or rehabbed properties where cost segregation can apply. Let me know if you want to discuss more in depth!

Wishing you much success!

Melissa Justice

Investment Strategist at Rent to Retirement

@Lee Banks,

If you're new to wholesaling and open to other paths in real estate, turnkey investing is a great strategy to explore — especially if your long-term goal is freedom, cash flow, and wealth building without being on the hustle 24/7.

Turnkey properties are fully renovated, rented, and managed by a local team — usually provided by a company that specializes in helping investors buy real estate hands-off. As a buyer, you're essentially stepping into a cash-flowing business from day one.

Why Turnkey Is Powerful (Especially for Beginners)
Passive income: Unlike wholesaling (which is active), turnkey investing pays you monthly with little involvement.

Speed: You can own a rental property in weeks, not months.

Built-in team: Property management, contractors, and leasing are already in place.

Lower barrier to entry: You don’t need to be a deal-finding expert or manage renovations yourself.

Tax benefits: Depreciation, mortgage interest deductions, and even bonus depreciation in some cases.

Where People Buy Turnkey Properties
Turnkey companies usually operate in affordable, landlord-friendly markets with strong rental demand. For example:

South Bend, IN

Memphis, TN

Akron, OH

Locust Grove, GA

Birmingham, AL

These markets offer better cash flow than high-cost areas like New York, and are ideal for building long-term wealth.

If I were 22 again, I’d wholesale to build cash — and reinvest profits into turnkey rentals for long-term freedom. That way, you get both money now and wealth later.

Wishing you much success!

Melissa Justice

Investment Strategist at Rent to Retirement

@Max Engel

You're in a fantastic position — with experience, capital, and a strong real estate network already in place, now's a great time to focus on scaling with turnkey properties, especially new construction and rehabbed rentals. This approach allows you to grow steadily while maintaining control of your time and cash flow.

Here’s how you can maximize your position:
 1. Invest in Turnkey New Construction Rentals
New builds offer:
- Minimal maintenance upfront
- Full builder warranties
- Typically attract higher-quality tenants
- Great depreciation benefits for tax savings

These are ideal for building a solid, low-hassle foundation of rentals — especially in growth markets like Locust Grove, GA or parts of the Midwest and Southeast.

2. Target Turnkey Rehabs in Cash-Flowing Markets
Fully renovated properties in established neighborhoods are often:
- Priced below replacement cost
- Deliver stronger immediate returns
- Some already tenant-occupied and professionally managed

Markets like Memphis, TN, Akron, OH, and South Bend, IN are known for solid cash flow with affordable entry points and consistent tenant demand.

3. Work with Established Turnkey Providers
Since you’re ready to deploy capital and scale, working with providers like us at Rent to Retirement can streamline the process:
- Offering fully renovated or newly built rental properties with property management already in place.
- You'll get access to investor-friendly lenders and potentially creative financing (like DSCR loans).
- Perfect for buying across multiple markets without needing to personally manage contractors or deals.

You already know the work involved in active investing — turnkey lets you scale without burnout. Working with your strong network, you can still vet deals, but let others handle the day-to-day. You can also deploy your capital efficiently and diversify across markets while maintaining consistent monthly income.

Wishing you much success!

Melissa Justice

Investment Strategist

@Rachel De Jesus,

Great strategy — using a HELOC on a paid-off property to fund out-of-state rentals is a smart way to put your equity to work, and you're thinking ahead about exit strategies, which is key.

What You’re Doing Right:
- Interest-only during the draw period keeps cash flow flexible.
- Using the HELOC to buy cash-flowing rentals means you're turning idle equity into income-producing assets.
- Planning for refinancing later (either the new properties or the original one) shows you're thinking long-term.

Strategies to Consider:
Refi the Acquired Rentals - Once they’ve appreciated or you’ve improved them:
- Use a cash-out refi or DSCR loan on the new property to pay back the HELOC.
- Aim to keep the refinanced loan amount ≤ 75% LTV to maintain decent cash flow.

BRRRR-Lite Approach
If you buy slight value-add deals, even turnkey ones with light updates, you could:
- Boost the value,
- Refi at the higher appraisal,
- Pay off HELOC faster without tapping your pocket.

Refi the Original Property (HELOC Source)
If rates remain reasonable and property value continues to rise:
- Do a cash-out refinance to consolidate the HELOC and lock in a long-term fixed rate.
- This may make sense if your HELOC rate balloons after the draw period ends.

Pay Down Strategically - If you’re earning strong cash flow from rentals:
- Consider partial paydowns during the 10-year draw, especially if your HELOC has a variable rate.
- Keeps your utilization low and improves your credit/future borrowing ability.

A Few Watchouts:
- Rate volatility: HELOCs are usually variable. Have a backup plan if rates spike.
- Exit timing: If market values drop or rates are unfavorable when you want to refi, it could delay your payoff plan — build in a buffer.
- Cross-collateral risk: Don’t overextend equity across too many properties without clear refinance timelines.

Turnkey providers like ours can help source rental-ready properties in strong cash-flow markets (like the Midwest and Southeast), making it easier to hit your HELOC payback goals.

You're thinking like a savvy investor — leverage with intention, always with an exit in mind. 

Best of luck,

Melissa Justice

Investment Strategist at Rent to Retirement