Q: Why choose a turnkey property versus investing on my own?
A: Investing in a property on your own certainly isn’t a bad idea. The upside of a turnkey property is in the name - it’s a much simpler investment. If you invest on your own, you must go through the entire research and purchase process on your own. For some real estate investors, they don’t have the time for the entire process and do not live near the property. Instead, they’d like to invest in turnkey properties because of the time savings and partnership with a local property management company.
Turnkey property investment is more about time savings and a simpler investment process. Sure, you can certainly get more for your property investment on your own, if you know what you’re doing and you’re willing to go through the entire process.
Q: Do I need to research my property even if I’m investing in a turnkey property?
A: It’s really up to you. We recommend researching the Memphis area and real estate market before you invest. Of course, we want your investing experience and interaction with us to be wonderful, and one it can be even better is by researching and knowing what you’re getting into. Most investors still spend a considerable amount of time researching because they’re investing their money.
Q: What concerns should I be aware of?
A: With any investment there are risks. The risks in turnkey property investment include tax hikes, property damage, poor rental agreements and tenants, or loss in property value. A real estate investment isn’t guaranteed to make you more money over time. Tax hikes and loss in property value are real concerns for real estate investment. However, the opportunity to make considerable cash flow and profit is quite ripe in the Memphis market. This is why investors are coming to the area because there are great opportunities. But we want you to be aware of the risks involved.
Q: How long should I invest in a turnkey property?
A: Real estate investing is a long-term commitment if you want to see the greatest return. If you can’t commit to owning and renting a turnkey property for several years, then it probably isn’t a good investment for you at this time. Also, you must consider the liquidity of real estate. It’s much harder to sell a property than it is to sell off stock. Granted, some real estate markets are ripe and easy sell within, but this isn’t always the case.
Q: Should I speak to a financial advisor ahead of time?
A: It certainly wouldn’t hurt. If you have enough capital to invest, then it’s a great idea to have a relationship with a financial advisor who can take a more objective look at your interests and provide guidance. Sometimes we can get emotionally connected to decisions and our lose our best judgment. So having a third party involved can keep you from making a significant financial mistake.