Today’s episode discussed what “Turnkey Real Estate Investing” is and further defines what a turnkey real estate investment is. A good understanding of this is important to make smart investment decisions and help avoid common pitfalls and traps investors make when buying these types of properties.

We also discuss our 5-Point Success System to help you compare turnkey providers. Picking the right turnkey provider is not just about the property.

We’ll also provide some tips, advice and comments on due diligence, rent guarantees, unnecessary fees, and the “2% Rule”.

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Turnkey Real Estate Investing Explained
Welcome to Passive Real Estate Investing. If this is your first time here, we're glad to have you. If this is not, then we're glad to have you back. Today's show is about turnkey real estate investing. This is a topic that's near and dear to my heart because I've been involved with turnkey investments for about eleven and a half years now.

I started investing out of state in late 2003 and I've seen the good, the bad and the ugly. Back then, turnkey real estate investing wasn't really a subject matter or term that was kicked around too much by real estate investors. People would talk about passive real estate investments, rent ready real estate investments, turnkey real estate investments. It was loosely defined and it was a general understanding of what turnkey meant. It wasn't a topic that had that much attention.

It does today. In fact, it's a hot topic. It's gained great popularity over the last ten years, especially over the last three or four. Today, it sees a lot of interest and controversy in real estate forums as well as other venues like real estate clubs.

Make smart decisions when it comes to passive real estate investments or turnkey real estate investments.

Why is this important? First of all, I want you to understand what turnkey real estate investing is as well as what a turnkey real estate property is. These are two different things as far as the way I look at it. I'm going to break that down for you today. You need to understand what it is and what it isn't in order for you to make better decisions. That's my second objective today, is to help you make smart decisions when it comes to passive real estate investments or turnkey real estate investments.

Let's break it down into different definitions and get a good lay of the land and then we can connect all the dots. This will hopefully educate you to better understand this particular area of real estate investing. From there, I'll give you five point system that we use to compare turnkey providers and turnkey companies. You can use the same system in order for you to look around and decide on who you want to work with and who's the better choice for you to help you achieve your goals and your criteria.

Regardless of where you choose to invest, there are two opposite ends of the investing spectrum when it comes to your involvement and required resources. On the one end, you have the do it yourself model or the do it yourself investment style, what I call active real estate investing. This is essentially a business where you're active involved, rolling up your sleeves, maybe getting your hands dirty.

Do it yourself real estate investing puts all the risk and responsibility squarely on your shoulders. Typically, that involves everything from sourcing the property, acquiring it, funding it, renovating it, maybe managing it, selling it and coordinating literally every step in the process. Of course, it's not likely you'll be involved in every single piece of that process by yourself, but you will be involved to some degree every step of the way.