turnkey real estate investments

The Ultimate Guide to Turnkey Real Estate Investments

Around 27% of Americans now rent a home as opposed to buying outright. This market has huge potential for revenue, but for those letting out a property, the time and effort required can be vast. So how do you tap into this market for passive income without the hassle?

One way is to buy a rental that is all ready to go (financed, leased or ready to lease, managed, etc). Read on as we discuss why you need to consider turnkey real estate investments. 

What Are Turnkey Real Estate Investments?

A turnkey investment is a home that you can begin renting out as soon as you have purchased it. You don’t need to do any renovations or spend money on upgrading and updating. The Realty Investments Corp. team can provide a stellar management experience (most headaches encountered here usually) or many folks choose to hire a property management company to take charge of them, so all they have to do is reap the investment income.

Unless you plan on making this a part-time occupation to handle tenant placement, repair issues, financials, and many other home tasks, you will actually save money and time in a lot of other ways.  

How Does It Work?

Properties will be bought by real estate companies or in some cases, even a property management company. After the home is prepared, the property will be marketed for rent and pre-approved screened tenants are found. With more expensive properties, a property manager can also come with the sale. 

Turnkey Property Standards

If you are looking for real estate in the DC metro area (or Garrett County), and are considering a turnkey property, you still need to do your work. This is because the term can be used loosely depending on who you buy from.

Some people may believe a turnkey property is one where minor repairs have been done and the whole house is clean. Another may provide you with brand new systems and a total overhaul. Both of these are fine as long as it is reflected in the price you pay, and you are provided with a list of all replaced and updated items on the property

What to Look For in a Turnkey Property

Even when provided with pictures and video guides, you should always view a property firsthand or have a trusted expeienced broker screen the property for you. This can give you a feel for the state of the property and the local area. 

The location is very important. How does the area fare economically? Does it look like growth will occur in the future and does the area have a good employment level?

Finally, check amenities, local schools, and access to public transport, employment opportunities.  All of this helps ensure you will get the best occupancy rate possible. 

Benefits of Turnkey Investment

Turnkey properties have a number of benefits for investors. We give the most important ones below. 

No Renovation

When you buy a turnkey property, it comes with all of the renovations completed. Updated HVAC, plumbing, electrics, and any structural issues are already addressed. 

This does cost more money. Weigh it against the time you would have spent along with the money on traders and materials, and a turnkey property becomes a sensible option.

Good for Long Distance Investing

When you have a property and do the buying and management yourself, it pays to do this in your local area. This is because you need to commute to and from the property, for everything from maintenance to dealing with renters. This is not the case with turnkey properties. 

As they are ready to go and already rented, you can organize everything from home. When a property manager is involved, you really don’t have to do a thing. This allows you to invest in places far off, without having to visit them regularly. 

No Tenant Searches

Searching for tenants is a time-consuming process. You need to market the property then screen the people you have shortlisted. If you get the wrong renters, it can cost you a lot of money down the line. 

When you get a turnkey property, tenants will already have been screened. They will be in the place itself, so you can start collecting rental income and claim peace of mind. 

Property Manager

Many homes that come furnished will also have a property manager. They will take care of all the day-to-day tasks, including liaising with tenants. You have very little to do except reap the passive rental income. 

Few Rental Gaps

The property is ready to move in as soon as you buy it. This means you won’t stall a tenant’s move-in date getting the property prepared and miss out on income. 

Drawbacks of Turnkey Investment

There are very few drawbacks when it comes to turnkey properties. We have listed the most important considerations below. 

More Expensive

When searching for turnkey properties, it is unlikely you will find a bargain. The company selling will have renovated, investing time and money into the property. All of this will also need to net them a profit, making it more expensive than other options. 

What you do gain is time and less effort. If you enjoy renovations and have the budget to do your own fixer-upper, then do. However, most turnkey buyers want the minimum of fuss with great returns. 

Limited Locations

Turnkey properties are not as easy to come by as other homes. In fact, some states do not have them at all. This means that if you want to invest in a specific area or location, turnkey properties may not be around for you to do it. 

Finding Turnkey Real Estate

Now you know the benefits of turnkey real estate investments, speak with a broker. They will know areas and the best places to invest. Before long, you could be claiming the passive income you require. 

Brett McCurdy makes real estate simple. If you are looking for any type of property as a buyer, seller, or investor, we can guide you. Contact us here to discuss your needs and see how we can help. 

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