What I Expect Out of My Turnkey Property Operator
Within real estate investing you will learn a plethora of information, topics and skills. I have been investing for 30+ years and along the way I can assure you I made many self-discoveries. (Many scratches and bruises as well). Searching the MLS repeatedly, looking for the best properties to fill my investment portfolio. Through much hard work, number crunching, and house tours, I eventually built up a nice portfolio of cash flowing properties.
Until I found a better way:
Relocating from the Northern state of Minnesota to the sunny state of Florida, I uncovered a much better way. At this time the real estate market was on fire in Florida. Home values were appreciating as much as 2% per month. While this was great if you already owned a lot of property, it was not good for an investor looking to make new investment purchases. While diligently looking for properties with great returns I uncovered turnkey properties. Yes there are companies that exist that actually run a business in selling single family homes already tenanted and with property management in place. These turnkey properties were much more interesting to me than doing the mundane task I was doing before. Before I was finding properties, researching whether or not I could buy the property for a decent price and then best guessing if I could indeed rent it out for a decent cash flow. With a turnkey property most of the guess work has been removed. I was able to actually buy a performing asset.
Why turnkey properties are non-listed properties
It was very time consuming and difficult to find good properties to invest in through the Multiple listing service. The turnkey properties solution was a much better alternative. What I learned is you cannot find these properties listed anywhere on the MLS system. Another self-discovery: was that the MLS system is designed to bring together the retail buyers and sellers of owner occupied properties. Turnkey properties are tenanted properties, tenants do not want to sell a home and therefore are not interested in people driving by and visiting properties. On many occasions these properties are purchased as a distressed property, then rehabbed and then tenanted. The buyers for these properties are investors and they have different wants and needs than the average realtor services offer. So to find these properties you want to find investment promoters, who essentially work with real estate investors the way a conventional Realtor works with a buyer or seller.
Not all turnkey property companies are created equal
With much trial and error, I have found that there are great companies, good companies and then not so good companies. Yes there are companies that offer turnkey properties, they sell it to you, shake your hand and wish you good luck on your investment. You will want to do extra due diligence on these investments or perhaps run from them all together.
A great turnkey property company will provide:
• Selected Property within the micro markets of the city
• Qualified renovation work to the property
• Properties that represent a sweet spot within the market
• Returns that are competitive or better for the market
• Full service property management
• Home warranties
• Work with you long term with interest in the investors long term success
A great business model
As a turnkey property company is essentially selling you a small little business it is imperative that they indeed run a successful business themselves. If they run a successful business it suggests they can better create and sell you a successful business as well.
When looking for your next investment you may want to find a promoter such as Equity Builders Group who vet the turnkey property company’s every day and can assist you to identify performing assets.