All Forum Posts by: Account Closed

@Sara Liskey I am glad someone else sees the value in turnkey! I’ll send you a connect request, maybe we can swap trade secrets.

@Natasha Sykes I am an investor in the Phoenix area as well. Are you tuned in with the wholesalers in the area? I’ve seen several deals come through lately.

@Brian Ellis tough crowd. I bought $36k in equity for $10k and I’m labeled as someone who is “stuck” with “dead equity”.

The mortgage is $1900 and it rents for $2400. You might balk at that, but as I mentioned before, my capex is financed in if I have a 5 year timeline for selling, or more likely, doing a 1031 exchange....at no point in time do I feel stuck. Maybe I’m the crazy one, who knows.

@Ujwal Velagapudi I’ve seen strategies where the investor buys properties as a primary home with 3.5% down, lives in it for a year to satisfy the terms of the loan agreement and then turns it into a rental. Rinse and repeat. The “work” here is to be willing and able to move each year.

Outside of a private lender you'll be hard pressed to find financing at 90% LTV or better on an investment property.

You might also consider “owner carry” or “seller carry” properties where the seller acts as the bank. Obviously this limits your options but it’s just another tool to keep in mind.

@Steve Vaughan you're generalizing again. I just bought a brand new build for $375k that appraised for $398k. Instant equity. All cash outlay minimized. For 3.5% down I've created a massive ROI using nothing but turnkey INVESTING. Call me a "buyer" all you want!

@Ujwal Velagapudi @Steve Vaughan

You’re both discounting the advantages that turn key has. If you’re just starting out as an investor you likely do not have huge sums of money to throw around. Buying a turn key property where you can finance the entirety of your investment is a huge win for many newbees. Let’s take a brand new build for example

1. Drastically less cash intensive.

2. Capex is largely being financed in if your hold period is 5 years or less.

3. Appreciation at market rate.

4. Appeal to the renter for top end rents.

5. Warranty is essentially financed in.

Sure, there is no instant equity injection so utilizing this strategy in an appreciating market is key. That said, if cash is hard to come buy, turnkey offers a TON of considerable benefits.

@David Weymouth @Joseph Piccola

Guys there is a lot of misinformation going on here. At $425/month to cover capex, vacancy, management, and turnover costs you are barely breaking even each month. If there is zero appreciation then your only return in this situation is principle pay down. If the AC unjt goes down that’s $7,000. If the roof fails that’s $15,000. If both happen your “cash flow” will be tied up for 51 months @ $425/month. Appliances breaking down is a very very very real expense in this game so just be careful!

Your ROI should be based on net profit. NET means you've accounted for everything I've mentioned.

Phoenix appreciation and rents are on the rise so I'm not saying you're in trouble.....but you're misjudging the terms cash flow and ROI dangerously here.

@Elise Marquette do you lend in AZ?

@Joe Villeneuve I am curious what kind of reserves you’d recommend carrying under the last scenario. If I’m hold $500k in properties at 20% equity each and let’s say the cash flow $100 each.... what’s a reasonable amount of reserve funds? Is it a percentage of overall property value? Percentage of total PITIA? A multiple of total PITIA? A number of months PITIA?

@Dzenan Catic

I use avail.co

I’ve found that it is a great value.