Author Topic: Early retiring with memphisinvest  (Read 636 times)

drpassiveincome

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Early retiring with memphisinvest
« on: August 25, 2017, 05:59:02 AM »
There has been some good discussion about turnkey rentals here before.

I was wondering what people would think of buying say 10 rentals from memphisinvest and early retiring on it.

Seems you can get 8% cash on cash returns with it. That's much better than a 4% early withdrawal rate. You get capital gains and principal paydown as a bonus too.

I'm trying to think of drawbacks? Maybe you'd need to keep a large cash reserve? How would it perform during recessions?

What do you think?

Another Reader

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Re: Early retiring with memphisinvest
« Reply #1 on: August 25, 2017, 06:16:53 AM »
The turn key rental companies rarely perform as advertised.  Talk to people that have used this one (they have been around longer than most) and see how they have actually performed.  If you have never been a landlord, read up on  the subject.  There is a sticky at the top of the real estate category with reading material.  Sword Guy recommends Gallinelli's book on the numbers.  I learned the numbers elsewhere, but you must have a firm grasp of investment property math before you write any checks to be successful.

tralfamadorian

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Re: Early retiring with memphisinvest
« Reply #2 on: August 25, 2017, 05:52:19 PM »
Personally, I consider turnkeys the riskiest of real estate investments.  Typically you are paying above market price in an area in which you have few to no other contacts besides the turnkey company.  The price is above market because you are paying for the convenience of an investment that is (hopefully) fully renovated with tenants in place.  Therefore, in low and no appreciation markets, your chances of selling at a profit are minimal. 

The turnkey companies are experts in purchasing distressed assets, renovating them inexpensively and quickly then selling them to owners.  They are often not experts in property management so usually the rates of eviction and turnover costs are higher while tenant retention is lower than average for that market.  Sometimes the renovations are not done well so further maintenance/capex issues are not unusual.  Communication is not always good so you will not know about any problems until you don't receive your monthly deposit on time and you ask. 

Now what I wrote is all doom and gloom.  Many people invest with turnkey companies and do great.  But you are putting a lot of trust in these folks to properly represent and manage every step of the renovation, purchase and management of your properties.

JayKay

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Re: Early retiring with memphisinvest
« Reply #3 on: August 28, 2017, 03:01:42 PM »
Hey there

I have a few rentals with MemphisInvest, PM me if you'd like to chat about them.

Bobberth

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Re: Early retiring with memphisinvest
« Reply #4 on: September 01, 2017, 03:29:21 PM »
I'm highly suspect of Turnkey providers. I live in a market where there are several that advertise to out of staters. My biggest advice is to ALWAYS compare what they are offering to what is available on the MLS/realtor.com. Trust but verify.