10 Reasons to Invest In a Turnkey Property
Turnkey properties are an excellent way for real estate investors to generate long-term passive income without a lot of difficulty. They can be especially beneficial for newer buyers who are eager to see an immediate return on their investment.
Here are ten reasons investing in a turnkey property might be the right choice for you.
Turnkey property companies will provide property management for you, so you won’t have to do any of the dirty work. They will research the best market, find and rehab the homes, and even find tenants for the property all on their own. After your purchase, they will continue managing any complaints or repairs for you.
2.Enter multiple markets
Because of the property management that turnkey property companies provide for you, you can have multiple properties out of state and not have to worry about being on-site to take care of them. This allows you to purchase properties in different markets, which is insurance against fluctuating market cycles
An extra benefit of being able to buy properties outside of where you live is saving money and staying within your budget. The real estate prices in your area may be soaring, but two states over the market could be much more affordable.
4. Warranties provided for repairs
When you first purchase a property from a turnkey company, all repairs and renovations will be covered during an initial warranty period. Even after the period has ended, the company will use its own contractor to handle repairs and will only bill you for the cost.
5. There’s an immediate return on investment
Turnkey properties are purchased move-in ready, and sometimes even with tenants already living in them. The time saved by not having to renovate the property or look for a tenant is a benefit in itself, but even more advantageous is the immediate cash flow this allows you to receive upon purchase.
6. You’ll pay off the loan
This cash flow is the difference between the rent you charge your tenants and the property expenses you owe. This method allows you to pay off the mortgage on the property with the money paid to you by the tenants and leaves you with a monthly cash flow that you hardly have to lift a finger to create. Once the loan is paid off in full, all of the money earned will go directly into your pocket.
7. Property appreciation
Turnkey properties tend to appreciate due to inflation and the demands of the market. Ownership of such a property would increase your own net worth, which you can utilize to build credit, making future investments easier to achieve.
8. You’ll build equity
With turnkey properties, it is possible to build equity quickly. Equity is the difference between the market value of the property and the amount you owe towards the loan. As the property appreciates in value and you start paying off the loan, the equity builds.
9. Aspects of turnkey properties are tax-deductible
Operating expenses such as mortgage interest, marketing fees, property taxes, property management fees, and repair and maintenance fees are all tax-deductible. This is extra money on top of the cash flow you’re already receiving through renting out the property.
10. You’ll receive cash flow
The cash flow is as close to effortless as you can get. With the turnkey property companies handling most of the managerial and grunt work, all you have to do to make a return on your investment is make the investment in the first place.
Investing in a turnkey property is a straightforward way to gain passive income and see a return on your investment. And, as always, the best time to invest is now!