All Forum Posts by: Steven Gesis

 Hi Jeff-

Welcome to BP and Turnkey, as an out of state investor, I always recommend taking a glance at the following guide, super easy, very easy tips and tricks to follow as you navigate the waters with Turnkey investing. 

 Sunny-

Wow, looks like you did a lot of homework on our organization, that is terrific, some of the things I agree with and some I do not :)  First thank you for all the nice words!

Second, our operation is not as simple as you have put it, but that is our core to the success and our proprietary knowledge :) . 

I am glad to hear that you have had success with us already to date, so we must be doing something right.

I would have to disagree with the categorization of the East side of Cleveland, in no way is it inferior to West Side of town, also keep in mind we are talking about locations in the same county. East side of town has some of the most luxurious and affluent neighborhoods coupled with very very strong school districts, some of the best in the State, along with the greater majority of the generational wealth, something the West Side does not have or offer. Additionally, the districts/neighborhoods on the East Side are not off-shoots of Cleveland proper as they are on West Side and are not tied to the Cleveland school district.

Brelion is a very cool space, you can find some of our deals being syndicated their. We have accredited investors that double dip, participate on the syndication and then purchase the assets for long term holds, increasing the rate of return while mitigating risk.  

You do not get a better risk profile by sticking to the West Side, in-fact you may be increasing your risk, especially if you are talking about purchasing Cleveland proper West Side. Parma a "pseudo" west side community, is not any stronger than any average working community on the East Side.  The West Side does not have the same amount of fortune 500 industry that the East side boasts, keep that in mind.

Our pricing is all dictated by market, as most investors now use some financing, the appraisers set the price not the provider, to say that the appraiser comps are weighed by investors and not owner occupants, would be false, as appraisers are able to distinguish this in their assessment. Furthermore, we do not operate in submarkets where the concentration of investor owners outweigh owner occupants, this is important also.

We do have a dedicated construction division, they are happy to serve as GC, however, our group cannot manage post construction, as we sold our retail property management division in 2014, only manage for Smartland Investors exclusively, so we are a boutique all-in-one shop, as we want to maximize ROI (consistent ROI) to the investor.

Feel free to PM me or Call me to discuss further.

 Isaac, welcome to CLE, first here is a simple guide for investing out of state:

A Simple Guide for Buying Out of State Turnkey Investment Property

Next, flipping can be successful just depends, how you plan on flipping, being hands-on or doing it remotely ? 

Cashflow is rich on rentals in CLE. Also, depends on your plan/strategy are you looking to be hands on or hands off....... are you looking for property and management or a real turnkey solution that already has that in place and is a complete and comprehensive solution with the property management component built-in.

Lots to think about, weigh and discuss.

Originally posted by @Yusuf Mathai:

So I am a new investor with a day job living in a market that is very hard to invest in (Portland metro area). My day job is such that it would be challenging to try and do real estate and manage it myself. As such I have been looking at the benefits of turnkey real estate with management on board. I have been looking at a number of markets and I am considering the Kansas City market.

I have lined up a visit to meet with one of the companies doing turnkey operations in the area. While I am there I am hoping to take a look at some of their inventory as well as the market in general. I am hoping that getting some boots on the ground will give me a sense of what I would be getting into. From some of the posts I see that this may be more of a cash flow play, occasionally there may be some appreciation. 

My goal at this point is to preserve some of my capital, so this would work. 

I was wondering if there were any people in this market (or other markets) who might give me some insight into the topic. Also besides trying to get comps for other homes in the area, being able to evaluate the rehab and doing some research on  the rehab company any other pointers that might prove helpful?

thanks for any replies that come my way

 Yusuf-

I always recommend reading the following guide, it is simple, easy to digest and should help you ask the right questions, as you navigate this space:

 Chheang, I know I am going to start a storm here:

I think its not only about neighborhood, you have to consider the sub markets within the neighborhoods, it certainly helps to better understand your plan. Are you seeking to be somewhat hands-on or simply a remote investor looking for good consistent cashflow?

Once you truly answer that question, I think you can better define area and sourcing. If you want something hands-off I always encourage a consideration to Turnkey, many argue you are paying a premium, no premium is a real turnkey, this is a market driven price if you are financing, the value will be provided through the appraisal, so it will be evident quickly whether the home is being sold at a premium or not. The reason I present this situation, is that you want a full accountability, especially if you are out of town, so simply buying something off the open market off the MLS, with a Property Manager partner, you are missing the most critical component, the physical construction support and maintenance support, that is not real true turnkey. Most Turnkey is off market, no premium, real Turnkey is not a process it is a cash flowing property with an existing tenant, no placement fees no realtor fees on acquisition, this is real turnkey. Now that is out of the way, we can talk about the neighborhoods.

I am not a West Side of Town guru, I am however an East Side of Town guru :) What I know about the West Side is if you want to play in the similar neighborhoods, you will not get the same value and rent rate as you will on the East side, based on my experience. West side is nice, East side is pretty amazing though, a lot of generational wealth, major shopping hubs, all major hospital systems are on the East side (Cleveland Clinic, University Hospital) - all major Universities are on the East Side of town, as well as the greater majority of the fortune 500 companies. Cannot get the same values/rental investor ratios in good quality neighborhoods on the West side as you can on the East Side of town. 

I do not play in the lower spectrum of neighborhoods or home prices such as $40-70K with under $1,000.00 rent, just not my cup of tea, I have several homes in my portfolio remaining from that novice/beginner time point in my investment life, but as I have evolved, so have my properties, in category and quality. The biggest lesson learned to date has been the standardization of the construction materials, quality and methodology. To layer that a little deeper, its all about resilient materials, most important NO CARPET!!!!

Always remember, everyone has a different strategy, it just depends what your strategy is, and what fits your risk profile.

FHA is only owner occupant loan with lowest rate/money down. It will be tough to find anything on the low side, like FHA, the upside is that you have to weight the cost of the PMI, you may not need the FHA.

 Patrick, concentrate on doing a deal not hitting a home run. Good path, consider a house hack, this can really help catapult your investing at such an early age. 

 Certainly, the right space to find your answer..... much luck on your investment success.

 Isaac, great point! I think the condition is the ultimate driver in this case, if the homes are updated and remodeled - they should be able to produce some steady cash flow. I think it is important to consider the quality and condition of the property as it will also drive the tenancy pool.

 Chheang I would encourage you to look at CLE, the taxes are not nearly as aggressive as you have noted. Many neighborhoods around NE Ohio that offer a very favorable tax rate, that is easy to bear and offers a good balance of risk and cash flow.