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BRRR vs. Turnkey

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  • BRRR vs. Turnkey

    Do you recommend easier turnkey out of state property investing or is it better to learn more about the process initially get straight into BRRR investing?

  • #2
    BRRR requires a well oiled system to work effectively and more complicated at a distance. As a beginner I would recommend more of a turnkey approach until you get more experience.

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    • #3
      I remember one day CNBC or whatever was in in the lounge and there was an IPO for a company that sold ice or freezer units something like that. The anchor said he thought the ticker should have been BRRR. I thought that was funny.

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      • #4
        The genuine answer that you probably won't like is: "it depends"
        i bought turnkey and I did BRRR
        Turnkey was an excellent learning experience for me... but i won't do it again. You buy a property at a premium price with no exit strategy. You are trapped with the management company and when you sell, you will probably lose money as all these properties are in areas that won't appreciate much overtime.
        BRRR requires time and effort + some experience
        All real estate investors that advertise for turn key companies and large syndications are biased!! they take commissions or indirect benefit from the sellers eg. lower management fee or referral fee...etc
        If you are a new REI, just buy one turnkey in a class B (not C) area and give it a shot for 6-12 months until you learn the process then do it on your own

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        • #5
          Originally posted by chrisg202 View Post
          The genuine answer that you probably won't like is: "it depends"
          i bought turnkey and I did BRRR
          Turnkey was an excellent learning experience for me... but i won't do it again. You buy a property at a premium price with no exit strategy. You are trapped with the management company and when you sell, you will probably lose money as all these properties are in areas that won't appreciate much overtime.
          BRRR requires time and effort + some experience
          All real estate investors that advertise for turn key companies and large syndications are biased!! they take commissions or indirect benefit from the sellers eg. lower management fee or referral fee...etc
          If you are a new REI, just buy one turnkey in a class B (not C) area and give it a shot for 6-12 months until you learn the process then do it on your own
          Thank you for the advice. Yes, turnkey seems easy but i realize that is not where the money is made. I just need a starting point. I can't start anything in my area because the property prices here are insane. I just need to figure out some basic beginner logistics as to how this works. Finding a team that will support a BRRR investment will take some time, especially doing long distance.

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          • #6
            I looked into turnkey for a long time. BRRR doesn't work long term for you; it might work for the provider. There is so many ways to raise cheap funds these days like crowdfunding sites, etc that if you have a team and are local then makes more sense to just raise money and do it yourself. I invested a Single Family rental fund and even they couldn't make more than 5-6% after expenses; I don't know how I can do it.
            As chrisg202 suggested, buy one deal and see how it goes for 1-2 years. Also, don't buy without visiting the provider and seeing the property.
            If you are accredited, I would suggested looking into MF syndications

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