Investing in turn key real estate have has one of the best investment strategies so far. But what is turn key real estate and why is it a great real estate investment for beginner real estate investors?
Related: The Advantages and Disadvantages of Turnkey Rentals for Real Estate Investors
What is turn key real estate?: An investment strategy
Turn key real estate is basically one of the real estate investment strategies through which a real estate investor purchases a property that is owned by a company. This company would have already applied the necessary renovation and has the property ready to rent. Therefore, as a real estate investor, you purchase the investment property and rent it out as soon as possible. In some cases, you will have the property rented out already.
Related: Best Real Estate Investment Strategies for Retirement
What is turn key real estate?: A form of passive income investments
A turn key real estate investment is a form of passive income investments. It allows a real estate investor to invest his/her money in a property and receive a passive income in return. This type of real estate investments is especially great for beginner real estate investors. Due to the little work a beginner investor has to do, it becomes easier to learn more about the real estate investment business.
What is turn key real estate?: A real estate investment for beginners
As we mentioned before, a turn key real estate investment is best for beginner investors in real estate. It is easy to finance, to manage, and to instantly start making money. This is because this form of real estate investments is already renovated and may be managed by an investment management company.
What is turn key real estate?: Investment property management
A turn key real estate property is already under the management of professionals most of the time. When a real estate investor purchases a turn key property from a property company, the company has, most likely, already hired an investment property management company. Therefore, you are only taking over the ownership of the property as it is. That is, of course, unless you choose to change the property manager or the company as a whole.
What is turn key real estate?: You still have to perform investment property analysis
Sure enough, as easy as it might seem, you still have to do some work before you start in turn key real estate investing. Just like any other investment property in real estate, you still have to perform investment property analysis first. Basically, what this means is to estimate the return on investment through analyzing the cap rate as well as the cash on cash return. This process is crucial for any investment property as it determines whether the property is worth the investment in the first place. Other than that, after you have purchased the turn key property, the investment property manager will take care of any further calculations.
To make it easier for you, Mashvisor has the best tools for you. The return on investment calculator that Mashvisor offers is the best when it comes to accurate estimations. It provides you with the most accurate analysis of a real estate property in order for you to be able to determine the profitability of your property.
What is turn key real estate?: You also have to perform real estate market analysis
The real estate market analysis is another aspect that you cannot go without when buying a turn key real estate property. This process also comes before actually purchasing the property. In order for you to be able to determine the profitability of the location, this one is essential. The real estate market analysis allows you to compare your turn key property to other similar properties in a certain neighborhood. Therefore, you will be able to get a sense of the appreciation rate as well as determining whether you are buying the property for a reasonable price.
What is turn key real estate?: You still have to do a home inspection
When looking for a turn key property investment, do not just settle for what the real estate company tells you. It is true that the property is already renovated and in a good shape. However, you still have to perform a home inspection to make sure that it meets your standards as well. Check all the facilities and make sure nothing is broken and everything is in place.
What is turn key real estate?: You still have to do some research
Sure enough, before getting into any kind of business, do proper research. Find out what is turn key real estate, where to find a turn key property, and what companies you can trust. It is important that you make sure to find a company that is trustworthy. After all, you are getting the property under your name, and the last thing you want is a property that is not worth the investment.
What is turn key real estate?: You must know who you are dealing with
Knowing for sure the real estate company you are dealing with is essential. Research the company first, and then check what investment management company they hired. Interview the investment management company, and make sure you ask about other clients so that you can contact them. Of course, we are not saying that you should be questioning them, but it is important that you check their work.
What is turn key real estate?: You can invest anywhere!
With residential real estate investing, you are more restricted as to where to invest. Mostly, residential real estate investors prefer to invest in properties that are close to their location. It is best when you are managing the property and have to keep up with it. However, when investing in turn key property, you can invest out of state as well as in state. You do not have to be close to your investment property as it is already taken care of by an investment manager. Therefore, you will only have to keep up with the manager to keep track of your investment’s performance.
Related: How to Find Investment Properties Out of State?
Finally
If you want to learn more about investing in turn key investment properties, check out Mashvisor’s blog. Also, learn all about the other investment strategies that are financially rewarding for beginner real estate investors in the real estate market.