But… choosing the right company to partner with is the key to making a turnkey investment work for you.
There’s no doubt that turnkey investment is a hot topic these days among savvy real estate crowds—a concept that has both fans and nay-sayers alike. Even though several definitions for this term are currently in use, a generally accepted meaning for “turnkey investing is as follows:
An investment strategy of buying, rehabbing and managing a property through a third party.
In other words, turnkey investments make diversifying your financial portfolio with real estate simple and hands-free, even from afar. As the term aptly describes, all you need to do is “turn the key and you’re in.”
Benefits of Turnkey Investments
- First and foremost, they provide attractive simplicity to investors. Going solo when you invest in real estate means you take on all of the tasks yourself… and there are many! By handing over the day-to-day management to someone else, you get the cash flow benefits without the headaches. As Brandon Turner of BiggerPockets.com states, “A turnkey real estate investment company attempts to simplify the process, so you ideally will only need to write and receive checks.”
- With turnkey investments, you don’t have to woo tenants… they come “pre-installed” on your property! With folks already in residence, you can count on immediate cash flow and avoid time-consuming—and often costly—marketing activities necessary to advertise your property.
- You can avoid the ROI guessing game. Instead of wondering what your cash flow might be with a specific rental property, you can step into your investment with a solid understanding of what kind of rental revenue to expect.
- And perhaps most appealing, a turnkey investment allows you to stay put, wherever you are, while cashing in on a great investment property—even if it’s far from your own backyard.
Cons to Turnkey Investments
Sounds like a simple, straightforward way to invest in real estate. However, buyers should be warned… all that glitters isn’t gold. There are pitfalls to turnkey investments, and avoiding them takes due diligence and legwork. For example, you could inherit bad tenants. Always make sure you thoroughly vet them before you purchase a turnkey investment.
As Erin Lowry of U.S. News notes, “Buying a turnkey property requires a lot of research, a significant chunk of money and a most valuable commodity – time.” She continues, “Anyone interested in investing in a turnkey property needs to be on the lookout for scam artists and perform their due diligence before taking the keys.”
Simply put, it’s critical to be cautious about what company you choose to invest with. Always do your due diligence as you research potential real estate companies for turnkey investments. Working with HomeUnion not only can help you achieve your investing goals, we can also provide you with expertise in the real estate investing process.
We’ll take the day-to-day pressure of property management off of your plate and approach your property management with the utmost professionalism. We’ll help you find quality tenants, collect rents and take care of any repairs. When you partner with HomeUnion, we can help ensure your success—and deliver peace of mind.
To learn more, schedule a consultation with one of our Solution Managers.