Virginia's population is expected to grow by about 1 million people by 2030. With a strong renter’s market and increasing rent prices, owning rental property is a great source of passive income. But, getting a property ready to rent and then managing it can take a lot of time and hassle.
If you want to get involved in real estate investing but are worried about these factors, turnkey property management may be the right option for you. Let’s take a look at five things you need to know about turnkey property management.
1. What Is a Turnkey Property?
A turnkey property is one that is sold in move-in-ready condition. It could be a house, condo, or apartment. If you’re buying a home, you could move in right away without any changes.
If you’re looking from a real estate investment point of view, it could possibly have an extra connotation. A turnkey property could be sold ready to rent or it could be sold with tenants already in place.
2. It’s Convenient and Hands-off
Since turnkey properties are ready to go, you don’t need to worry about making upgrades to get the property ready to rent. This makes it much more convenient.
In fact, some people even purchase turnkey properties sight unseen. This is especially common for investors who don’t live in the same area as their investment property.
In addition, turnkey property management can make owning investment property even easier. Property managers can handle every part of the rental process from screening possible tenants to completing maintenance.
If you want to invest in real estate, but either don’t live in the area or don’t want to handle the day-to-day tasks, turnkey property management could be a good option.
3. The Financial Benefits
If you buy a turnkey property with a tenant already in place, you’ll have cash flow from day one. This can be especially important because the process of finding a good tenant can take a long time. During this time, you wouldn’t pull in any money.
Using a real estate management company obviously means you’ll need to pay them a fee to manage the property for you. While this does add to your cost, it could actually help you in the long run.
When you do have a vacancy, a property manager can help you fill it quickly, with a well-qualified tenant. They can also help you set rent prices that are competitive but offer the best return.
Plus, think about the time you’d be saving by having someone else manage your property for you. You don’t need to quit your day job. You can still work while bringing in extra passive income every month.
4. The Downsides of Turnkey Property Investing
Sellers of turnkey properties may have bought the properties for a deal and put work and money into making them ready to go. In order to make a profit, they often charge much more for move-in-ready properties.
This means that you may have to make a larger initial investment when buying the property. In addition, the cap rate may be lower than on other investment properties.
5. You Need Research and Due Diligence
When you are buying a turnkey property, it’s important that you do thorough research about the market. In addition, sales photos may not show you potential problems that are still present in the home.
If possible, you should always inspect the home and make an informed decision. A rental price analysis can help you make an informed decision.
Increase Your Cash Flow with Turnkey Property Management
A turnkey property can be a great way to get involved in real estate investment. By working with a turnkey property management company, you can make the process even smoother.
If you’re ready to get started with your investment property, call Renters Warehouse.