No, not turkey real estate! Turnkey real estate isn’t that prevalent, but it can be a great option for you to dive headfirst into the world of real estate.
What is turnkey real estate? Well, it refers to buying a property that tenants are still occupying with an active lease. While this sounds scary because you’ll be responsible for tenants you did not choose, it does mean that you’ll get instant cashflow.
How Does It Happen?
Well, sometimes property owners are not equipped to hold onto their property as long as they thought they could. That is where you come in and save the day. You obviously can buy a property that has a current lease, but it can also refer to buying a property that is instantly ready for tenants. If you just buy a property that is ready for tenants to inhabit, you won’t get the instant cashflow, but it does mean you get to choose your tenants.
Should I Go With Turnkey?
Well, it depends on what you are looking for. If you’re looking for a relatively easy investment, go for it! You should probably look for already inhabited properties though. If you want a non-hassle property, but still want to choose your clients, then having a prepared property without tenants is the right choice for you. If you are new to real estate, it’s a great way to wet your appetite, as it’s relatively low stakes. Additionally, if you are really busy, or don’t want a hands on property, turnkey is a solid way to bring in income without a lot of work.
Pros of Turnkey
First off, Turnkey does sound a bit like too much guesswork. Tenants you don’t know? Easy to dismiss. However, you will have the history of the property. No one will expect you to make an uniformed decision. You will have relatively instant cashflow, and it can be as hands-off as you want. You can even get a turnkey investment in a different state. Because you already have tenants, you can hand the property over to a property manager to keep up with it, and you just reap the benefits.
Cons of Turnkey
While you will have details about the property, chances are you won’t see the property before you buy it. That’s taking a huge leap of faith. Additionally, if you aren’t careful, you may pay higher than what the property is worth, or the property may just cost you more than it makes. Bottom line: don’t jump into turnkey investing without doing your research. A little bit of digging is better than losing money.
Next blog post, we’ll dive into the steps and tips that will make turnkey rentals simple for you!
For more information about this topic, check out the article that inspired our blog: https://finance.yahoo.com/news/2021-clear-simple-guide-turnkey-181431989.html