Pros and Cons of Turnkey Real Estate Investing
You've probably encountered the term "turnkey" several times before or you already probably know what it means since you are reading this blog. Anyway, by definition turnkey is a product ready for immediate use. And a turnkey property is a move-in ready property or fully renovated.
If you are thinking of opting for turnkey real estate investing, here are the pros and cons of turnkey real estate investing
Pros of Turnkey Real Estate Investing
The property is move-in ready
This means that you would not have to wait for months for it to start producing cash flow. Since it is move-in ready you can start listing it for rent right away. Some turnkey properties are even tenant occupied already which means the moment you closed the deal the turnkey rental is already producing cash flow. And you won’t have to wait for days or weeks before it starts to produce cash flow.
Adds portfolio diversification
Investing in turnkey real estate adds diversification to your investment portfolio. If your local market is too expensive for real estate properties, it is much easier to add turnkey real estate from a different location. This helps you mitigate the effect when the local area goes into a downturn.
It can be totally hands-off
Turnkey real estate investing does not require much time and work. It is considered a source of passive income. When you hire a property manager, you become totally hands-off as the property manager will deal with the tenants, from finding the right tenants to rental collection payment and other maintenance works required.
Cons of Turnkey Real Estate Investing
Less customization and Personalization
Since it is already a move-in-ready property and you were not involved in the renovation process or construction process of the property, you will have no control over the appearance of the turnkey property, landscape, layout, and the like.
While investing within your local market is advise when you are starting a real estate investment, investing long-distance or out-of-state is a great option for those who would want to invest in real estate at a much cheaper price and of course, to diversify the portfolio, an investor needs to do due diligence. And being away from your investment means that you cannot always check the property right away, so it is important for you to get a good team when you are doing long-distance turnkey real estate investing.
Since turnkey is already move-in and all the dirty works were done by the turnkey provider, the price of the turnkey house is usually lined in with the market value.
When it comes to investing, it is important to weigh-in the pros and cons of your investment. Educating yourself is also important to help you in getting the right choice when it comes to turnkey real estate investing.
Your Home 901 provides turnkey real estate investing opportunities call us 901 308 2815 or email email@example.com