In the real estate investment industry, a turnkey property refers to a property that has been purchased, renovated, fully equipped, and is ready for immediate rental. From an investment perspective, these properties are often sold to buyers who are looking for an investment that requires minimal to no additional work after purchase. Here are key characteristics of turnkey properties:
- Renovated and Ready: The property has been recently renovated or updated to make it appealing to potential renters. This means the investor doesn’t have to spend time and money on improvements before it starts generating rental income.
- Managed: Turnkey properties are typically managed by a property management company. This is beneficial for investors who do not live near the property or do not want to manage the day-to-day operations of being a landlord.
- Income-Generating: One of the appeals of a turnkey property is that it can often come with tenants already in place, and thus, it generates income from day one.
- Appealing Locations: Turnkey properties are often located in areas with high rental demand, which can lead to lower vacancy rates and more consistent income.
- Hands-Off Investment: The turnkey approach is designed to be a hands-off investment for the buyer. Once the property is purchased, the investor can usually step back and let the management company handle the rest.
- Costs: Turnkey properties may come at a higher price compared to properties that require renovation because of the convenience and immediate rental readiness they offer.
Investors looking for turnkey properties typically value the time savings and immediate cash flow over the potentially higher returns that might be achieved by purchasing a fixer-upper and managing the renovation process themselves.