Purchasing a turnkey property during a global pandemic may seem a bit daunting at first, but there are ways to gauge which properties are worth the investment. It’s important to keep in mind that there many different market trends to be considered when searching for turnkey properties that deliver a high return.
If you’re searching the market for turnkey properties, you’ve already decided to take a “hands-off” approach to property rental. Carefully studying current housing markets and trends can bolster the chances of getting the most from your turnkey property investment without the headache of doing everything by yourself. Here are a few aspects to consider when looking for the best turnkey investment properties.
Study Real Estate Life Cycles
When it comes to investing in the turnkey property market, the right timing is crucial because the economic market is constantly changing. These changes are best classified as 4 phases in the real estate life cycle: recovery, expansion, hyper supply, and recession. These cycles differ depending on the local market in which you’re looking to invest.
Typically, areas that are in the recovery and recession phases are the best to buy property in because of lower market prices and higher vacancies. However, the global health crisis has now inadvertently given investors the upper hand in real estate because of the reduction in property sales resulting in sellers being more willing to accept lower offers.
Keep Up with Local Economic Trends
Location is everything! Choosing to invest in areas that have large populations and high rental demand are the most promising. Cities anchored to successful companies like the city of Detroit and the massive automobile industry can be viewed as safer during uncertain times like these.
Housing markets in areas like Detroit are seeing a decrease in interest rates but a spike in demand making Detroit a desirable location for potential turnkey investors. Be sure to look out for peak seasons in the local housing market that either increase or decrease prices. With that being said, a peak season is coming to Detroit that shows housing prices to be 18% lower than average in January, according to statistics. This is the perfect time to invest in Detroit property!
Careful Home Inspection
Some homes may be listed as turnkey properties, but you can never be too sure. You don’t want to buy a seemingly renovated property then be ambushed with unforeseen expenses due to poor workmanship on the house. Save yourself the trouble by hiring a reputable home inspector or find a property management company that works with trusted contractors who produce high-quality work.
Another aspect to consider is the overall surroundings of the property you want to invest in. Do some research on the seller and determine whether they have a good track record in the community. Examine the upkeep of neighbor’s homes to see whether the neighborhood is a desirable location.
Hire an Expert
The purpose of purchasing a turnkey property is to generate a profit without all the heavy legwork. Most things are taken care of, but unexpected hassles can bring about unnecessary stress. For example, some turnkey properties come with a tenant, but others don’t and finding a suitable tenant can be difficult, but a local property management company can screen and secure qualified tenants for you.
Invest in a property management company that offers a range of services and provides a team of supporters that make the buying process smoother. A full-service property management company can help with property maintenance, direct rental payments, online accounting, and other services that are helpful to investors like you.