Why It’s Better to Own a Turnkey Rental Instead of a Vacation Rental

As recent times have proven, people won’t always be able to go on vacation, but they’ll always need a place to live. This is just one reason why it’s better to own a turnkey rental instead of a vacation rental. Myriad problems have emerged regarding vacation rentals on the market. When the COVID-19 lockdowns came into being around the world, people cancelled their vacation rental reservations en masse. Some vacation management companies, wishing to placate vacation rental owners, refused refund requests until pressed by outraged customers and ultimately, the media. But those bad refund experiences of the non-vacationers will likely remain ingrained in their memories; at least long enough for them to choose elsewhere for their vacation needs when the pandemic is over. If you’re looking to own property, a turnkey rental will give you a more peaceful life. Following are more reasons why you should own a turnkey rental over a vacation rental:

 

Turnkey Rentals Are Passive Income

You’ll have very little to worry about with your turnkey rental. Once a month, your property manager will deposit your tenant’s rent money into your designated bank account. Other than that, you can basically not think about your turnkey rental. Every once in a while, you may get a repair request that runs through your property manager. You won’t have to do any actual work; the property manager handles that end. But aside from that, owning a turnkey rental is entirely passive. The only thing you need to know about is the money side; money automatically deposited into your bank account each month, and occasional repair expenses. Not a bad way to live, right?

 

Turnkey Rentals Offer High ROI

You’re going to see a high return on investment with your turnkey rental from MartelTurnkey. Typically, you’ll get between 12-17% after fixed costs (including property management) and assuming a 20% down payment. If you doubt that, just check out our fully transparent online listings, like this one in Cleveland, Ohio. You can easily see that the ROI is 15% on this single-family turnkey rental. It’s hard to get those kinds of consistent returns with other investment assets, including vacation rentals. Remember, when you own a turnkey rental, you’re getting a paying tenant for a minimum of a year, while they live out their lease terms. With a vacation rental, you’re usually only guaranteed income for a week or two. After that, you need to market for a new vacationer, which is nearly impossible in today’s COVID-19 situation.

 

Your Tenants Are Vested and Vetted

In a turnkey rental, your tenants have a vested interest in keeping the property in good condition. After all, it’s their home. They’ll want to keep it clean and tidy for their family members to enjoy. This usually extends to the garage and/or yard if there is one. With a vacation rental, tenants have less  reason to care about the condition of the property. They’ll be there only a week or two, so why should they bother tidying up? Also, they’re on vacation and won’t want to spend time dusting or cleaning floors. They may be partying, possibly tracking in sand and water, and maybe even inviting all their friends over for even more partying. Then they’ll take off, leaving you and your cleaning and repair crew to deal with the remnants of their vacationing. Too often, this includes serious damage like holes in the wall or nicks in the wood finishes. On the other hand,  in the case of your turnkey property, the property management company conducts background checks to ensure your tenant has the ways and means to pay the rent, they conduct criminal background checks, and they collect a security deposit to cover any damage found upon leaving.

 

Vacation Rentals End Up Costing You More

Every time your vacation tenant moves out, you have to pay for a cleaning crew to get in there and make it nice for the next renter. If you’re lucky and you rent out your vacation property 40 weeks out of the year, that’s 40 times you have to pay a cleaning crew. That doesn’t sound very lucky, does it? With a turnkey rental property in your portfolio, you only need to worry about cleaning once a year at the most. And then, the property manager takes care of it, so you still don’t have to worry about it. Vacation rentals typically get damaged more than turnkey rentals, too. Vacationers aren’t going to go out of their way to inform you about little problems that can escalate into expensive repairs. Will they let you know about the missing shingles that lead to the roof leak that leads to the black mold behind the drywall? Nope. By the time you find out about it, your $20 shingle replacement has turned into a $5,000 new roof expense.

 

Pay More Taxes With Vacation Rentals

Here’s the real kicker about vacation rentals that no one tells you about beforehand. Did you know that many towns and cities charge vacation rental owners short-term occupancy tax? Sometimes they’re referred to as “tourism tax,”’ but the final result is the same; vacation rental owners pay more taxes than turnkey rental owners. It’s not a small amount, either. Some municipalities charge six or seven percent or even more. That’s not very appealing is it? In fact, for most smart real estate investors, that’s the final straw in a long list of reasons not to own vacation rentals. If you agree, then head on over to our turnkey rentals for sale page and find a turnkey rental that pays you money, not the other way around.

 

During this pandemic, vacation rental owners are suffering more than usual, with a cascade of cancellations, mortgage payments to make and a lot of bad press. Why put yourself through that when you can enjoy the enjoyable, passive income that comes with a turnkey rental? Interest rates are at their lowest point and you can lock in that rate for the life of your loan. Now’s the time to get in on the best real estate investing model that exists. Choose your turnkey rental today.

Interest Rates Through the Years

Throughout the last five decades, interest rates have bounced around more than a pinball in an arcade hall. Fluctuations in the market have opened the doors for alert opportunists to make a lot of money. Others who found themselves on the wrong side of the market have lost fortunes. This is nothing new. It’s the way our economy works. One month it’s down, the next it’s up. There’s only one thing you can be certain of when it comes to interest rates; whether they’re up or down, they’re sure to head in the opposite direction sooner or later. With mortgage interest rates historically low right now, you need to take action.

 

Looking Back at the 70’s

 

The decade of the 70s was marked by polyester, the breakup of the Beatles, the debut of “The Hustle” dance, and the opening day of Walt Disney World on October 1, 1971. While John Travolta was staying alive with Saturday Night Fever, interest rates for 30-year mortgages were hovering around 7.29 to nearly 9%. When inflation started skyrocketing, President Nixon imposed a 90-day freeze on wages and prices. The Federal Reserve also increased interest rates that led to an eventual high of 18.63% by the early 1980s. If you were an investor in the 70’s, by the end of the decade those high 7s and low 8s interest rates would have been a distant dream if you hadn’t acted fast.

 

Looking Back at the 80’s

 

The early 80s were marked by significant interest rate increases. Mortgage rates hit an all-time high of 18.45% in October of 1981. The Housing Affordability Index dropped to an all-time low of 62%, which meant that the typical American family had only 62% of the income necessary to qualify for a median-priced home. Home sales were heavily depressed. There was a 50% drop in home sales from 1978 to 1982, when only two million homes were sold. Not until 20 more years had passed did home sales get back to 1978 levels. For would-be investors, there was no economically viable way to get into real estate investing. The window of opportunity was closed and locked.

 

Looking Back at the 90’s

 

In the 90’s, interest rates returned to a tolerable level, with the overall average ending up being 8.12%. Investors who had been waiting with bated breath to make their move suddenly saw a chance to start doing what they’d been talking about doing for so long; buying property for investment purposes. Home values were dropping like a rock, which wasn’t great for sellers, but which offered opportunity to those ready to buy. Of course, the real estate bubble ended up being the “steepest rise and fall in U.S. home prices on record.” As is always the case, depending on your position, you could have made a fortune or lost your shirt.

 

Looking Back at the 00’s

 

In 2000 and beyond, we saw interest rates continue to drop to an average of 6.29%. Thousands of property owners refinanced, figuring that they’d never see these “Baby Boomer” interest rates again in their lifetime. A boom in housing construction flooded the market with inventory and perhaps also contributed to the subsequent Great Recession. Lenders were only happy to loosen lending restrictions through the diabolically ingenious subprime loan packaging strategies. Millions of borrowers defaulted on their loans and…well, you know what happened next.

 

Looking Back at the 10’s

 

Objects in your mirror may be closer than they appear. The decade of 2010 to 2019, which is right behind us, continued to bring us lower interest rates. Nearly inconceivably, the average interest rate went down all the way to 4.07%. If you hadn’t refinanced or purchased a property before then, hopefully, you made a move. Almost certainly, interest rates would start to head north again, especially with the election in 2016 of a new president who didn’t exactly win any popularity contests. In fact, in December of 2016, the Federal Reserve actually raised its key interest rate by a quarter of a percent, signifying newfound confidence in the U.S. economy. According to Janet Yellen, chairman of the Federal Reserve, “We expect the economy will continue to perform well.” The past decade was a great time to invest in real estate, and any investors made their move.

 

Looking at Today’s Investing Climate

 

Today, interest rates are at an historical low. Investors with good credit are getting rates as low as 3.24%. Every financial guru is urging investors to strike while the iron is hot, which is now. There’s literally never been a better time to invest in real estate than right now since the last five decades and then some. You’re looking at setting a fixed rate of 3.24% on your mortgage loan for the next 30 years. You know that in five, ten or twenty years there’s no way the interest rates will remain this low.

 

So what are you waiting for? If coming up with a down payment is a factor, pool your money with another investor or get a side hustle that will earn you the little that it will take. Remember, all you need is one property to get on the real estate ladder. Once you’ve managed that first rung, you’ll be set to keep climbing until you can build real wealth. You’ve just read the facts about interest rates through the ages. How much longer can you afford to wait? The time to act is right now.

Reasons to Invest in Cleveland

Cleveland is in a growth stage and now is the time to get in early. Your opportunities to succeed in real estate investing in Cleveland have never been greater. Cleveland’s market offers reliable, cash flowing properties that both new and seasoned investors can enjoy. And since there are so many positive reasons to invest in Cleveland right now, this bustling metropolis carries fewer risks than other cities in the country. Read on to learn about the reasons you should be investing in Cleveland right now.

 

Job Outlook and Major Employers

According to the U.S. Bureau of Labor Statistics, Cleveland has a labor force of well over a million as of May 15, 2020. Despite a recent dip in growth rates, likely due to the COVID-19 pandemic, the job market still points to an overall stable economy that will steadily increase for the foreseeable future. Moreover, there is room for continued growth thanks to the fact that a couple of Fortune 500 companies have their headquarters in the town. The chances are very high that more people will soon be moving to the region to work for Cleveland’s largest employers as they expand and their labor needs grow.

 

Currently, the top employers in Cleveland are: 

 

     – Goodyear Tire and Rubber

     – KeyCorp

     – Sherwin-Williams

     – Aleris

     – Amazon

     – FirstEnergy

     – Lincoln Electric

     – J.M. Smucker

     – Eaton

     – Cleveland Clinic

     – Cliffs

     – Parker

According to the Society for Human Resource Management, Cleveland’s job and economic outlook is sunny skies ahead. About 85,000 job openings in the health care industry are predicted from 2015 to 2025, says Jacob Duritsky, Managing Director of Research for Team Northeast Ohio. By 2025, Cleveland is set to have about 123,000 new jobs overall, with a large number in the food manufacturing industry.

Community Facilities

Cleveland has a robust community facilities infrastructure in place. Community facilities available in Cleveland include world-class health care, over 150 public parks, green spaces and playgrounds, 28 public library locations, historical landmarks, bustling shopping centers, and restaurant dining opportunities that encompass global cuisines. The abundance of these community facilities and social amenities make it easy for Cleveland residents to access whatever they need within short reach.

Local Development

Cleveland’s forward-thinking government officials are focused on local development and have a department of community development designed to conserve existing infrastructure, revitalize commercial spaces, market vacant land lots for development and make it easier for investors to help grow the region into prosperity. As a real estate investor in Cleveland, you’ll be able to reap the benefits of this growth through enhanced property values and tenant demand for rental housing. 

 

There are two bedroom  communities just outside of Cleveland that are also worth mentioning here: Euclid and Maple Heights.  We see tremendous growth potential in these cities. Euclid is developing the lakeshore with a boardwalk connecting two parks and neighborhoods, attracting weekend athletes and families. This multi-million dollar project is catching the attention of many other small cities on the lake. People are noticing what is going on in Euclid. 

 

Similarly, the Maple Heights’ community development department is razor-focused on enhancing the look and feel of the neighborhoods with attractive homes, local events, better amenities, and improved transportation.  Along with these improvements comes notable capital appreciation, which we love.

Transportation 

Cleveland, Ohio offers drivers a well-woven network of highways, intermodal, and intermodal connections. Rush hours in the metropolitan area are lighter than other areas in the country with vehicles in most roads almost hitting posted speed limits. A web of reliable bus lines mostly handles public transport needs.

 

For those looking for alternatives to motorized travel, it’s possible to ride a bike to many places using the well-defined bike paths and busy bike routes. A highlight is the paved Emerald Necklace Trail System that spans 70 miles through 20,000 acres.

 

Cleveland has two airports; Cleveland Hopkins International Airport and Cleveland Burke Lakefront Airport. Major airlines flying in and out include United, Delta and American Airlines. This easy access to air transportation makes Cleveland ideal for everyone from corporate executives to visiting friends and family members of area residents.

 

These are the primary reasons that make Cleveland, Ohio a city worthy of your attention when looking at areas to invest. Your turnkey rental in Cleveland will be highly sought after by tenants and current or future employees of some of the largest employers in the country. Cleveland is thriving, even in these challenging times. Imagine what the future holds for your investment when things turn around. Get in on the ground floor by investing in Cleveland today! For information about available turnkey rentals, please contact us

Turnkey Rentals and 3 Pitfalls to Avoid

MartelTurnkey turnkey rentals are considered a solid investment for anyone looking for passive income. Our turnkey rentals are chosen with great care and sold with property management and paying tenants in place 100% of the time. But there are lots of turnkey rentals on the market from other companies that may appear equally attractive—at first glance. Real estate investors need to know that not all turnkey rentals are smart investments. There are certain things you need to look for in a turnkey rental investment – and pitfalls to avoid. Here’s a list of pitfalls to watch out for.

 

1. Being Drawn to Appearances

When shopping for a turnkey rental, keep in mind that you’re not shopping for your primary residence. This isn’t the place where you need to feel proud to bring home your family. No one’s going to be judging you by how attractive your turnkey rental houses are.

 

Don’t be drawn in by inexpensive decorative touches when considering a turnkey rental investment. Anyone can paint shutters and plant a potted geranium on a porch and try to convince you to invest, but that doesn’t make the property more valuable to you. These niceties can be useful in helping to attract tenants later on, but you shouldn’t be lured into investing just because a place is “cute.” You need to dig into the numbers, which are always available for close review with all of our MartelTurnkey turnkey rentals.

 

Furthermore, it’s not necessary for you to do time-consuming drive by’s or expensive piloted fly-overs to evaluate a property, as this book about out of state rental investing explains in depth. Photos are sufficient as long as you have all the other necessary information to make your decision.

 

2. Neglecting to Ask Questions

 

Before you invest in a turnkey rental, you should have every single one of your questions fully answered. A quality turnkey rental company will be happy to answer all your questions. At MartelTurnkey, we answer our own phones and our team is ready to answer any question you have, no matter how small. When you’re a successful person in other areas of your life, you may feel embarrassed to ask things like what certain real estate jargon means, or how the ROI is calculated. But if you don’t ask, you won’t learn, and our goal is to educate all of our investors.

 

Never give anyone your investment dollars until you have every last one of your questions answered. You don’t want to find out after the fact that you misunderstood some aspect of your investment choice.

 

3. Overlooking the Importance of the Turnkey Rental Company

 

With turnkey rentals, it’s just as important who you do business with as it is which turnkey rental property you buy. Overlooking the importance of your choice of turnkey rental companies is one of the most common pitfalls that real estate investors fall into. Turnkey rental companies don’t need special licenses to operate. As such, anyone can make one up and start selling turnkey rentals. This makes for a treacherous environment for real estate investors. You need to carefully vet any turnkey rental company you consider buying from. Look at their testimonials, check out their business rating and see what others are saying about them online and in person. Buying from a bad turnkey rental company can end up with you owning a property that hasn’t been carefully rehabbed, has back taxes due or has other serious issues that can tank your investment.

 

These are the most serious and common pitfalls associated with investing in turnkey rentals. At MartelTurnkey, we work hard to make sure our investors are fully informed and have access to beautifully rehabbed investment properties in several markets. We have a long history of customer satisfaction and plenty of testimonials to back up that claim. If you’d like more information about our available turnkey rentals or about our company, please contact us.

7 Tax Deductions Landlords Are Entitled To

The government has extended the 2019 tax filing deadline to July 15. This is good news for everyone, but especially landlords. It means you have more time to make sure you take all the deductions you’re entitled to. The taxes that come with owning a rental property can feel overwhelming . Fortunately, there are legal ways for landlords to save a lot of money on taxes. Yet, it may come as a surprise to hear that many landlords don’t take all of the tax deductions available to them. Nobody should have to pay more than they are required to in taxes. There are a few important tax deductions that every landlord should note.

 

1. Wages Paid to Both Independent Contractors and Employees

Anyone who runs a small business is able to deduct the expenses tied to that business. When it comes to being a landlord, this includes wages paid to employees and contractors. Any payments made to someone to clean the house or maintain the yard are tax-deductible. Any wages that are paid directly from the landlord to independent contractors or employees can be deducted from the taxes. On the other hand, any third party (a subcontractor) who is paid by an independent contractor or employee for expenses can’t be deducted from the landlord’s taxes. Those would be deducted from the contractor’s taxes instead.

 

2. Repair Jobs

From time to time, repairs are going to come up. This is one of the most common expenses associated with being a landlord. Some of the typical repairs that landlords face include fixing broken gutters, repairs or replacement for damaged roof shingles, plastering jobs and fixing leaks in the home. The costs of materials, labor, and any damage restoration expenses are all fully tax-deductible in the year they were incurred. It is important to differentiate between repairs and improvements, as improvements are not tax-deductible.

 

3. Marketing and Advertising Expenses

Every business, including owning rental properties, has marketing expenses. All of these marketing expenses are tax-deductible. Some of the most common marketing expenses include paying for a business profile on various social media sites, posting flyers and bulletin boards around town, and even placing ads in the local newspaper. Even the cost of a “for rent” sign in front of the property is tax-deductible. If a property manager is hired to field tenant requests, keep the property occupied, and handle maintenance issues, this cost is also tax-deductible. Now, if you own a turnkey rental from MartelTurnkey, you probably won’t carry any of these costs, since you have a property manager that handles all this on your behalf. Instead, the marketing and advertising expenses that a property management company incurs would be deducted on that company’s tax return.

 

4. Utility Bills, Taxes, and Insurance

Some of the other routine fees and bills that are tax-deductible include property taxes, building insurance, and utility bills. These also fall under the categories of business expenses. Therefore, landlords need to make sure they keep track of these expenses. Track any internet costs, electricity bills, water bills, gas expenses, and phone bills because all of these can be deducted from a landlord’s taxes. Often, landlords overlook the cost of property taxes and home insurance because these are included in the mortgage payment. Make sure to look at the mortgage breakdown and track home insurance and property tax costs. All of this can be deducted from the landlord’s gross taxable income.

 

5. Travel Expenses To and From the Property

Many landlords, especially owners of turnkey rentals, don’t live in the same area as the rental property. Traveling to and from the rental property also qualifies as a business expense. For example, if the landlord has to fly somewhere to visit the property, the cost of the plane ticket is deductible. This also covers taxi or shuttle trips in addition to the cost of the hotel, if necessary. Bear in mind that leisure activities during this visit are not tax-deductible.

 

6. Maintenance of the Property

There are going to be some other routine costs that come along with running a property as a landlord. The amount of money spent maintaining the property is tax-deductible. Some of the most common property maintenance costs include changing the furnace filters, checking and re-grouting the tile, and inspecting the hoses that are attached to appliances. In between leases, you or your property management company may need to replace weather-stripping, install new insulation, or have the chimney or ductwork cleaned. All of these property maintenance costs are tax-deductible. On the other hand, it is important to note that any “betterment” projects are not tax-deductible. This includes home renovation projects, such as kitchen redesigns or bathroom upgrades.

 

7. Interest Paid on a Mortgage

Finally, any landlords that are still paying a mortgage should remember that the interest on that mortgage is tax-deductible. During the first few years of mortgage payments, most of the money paid to the lender is interest. Therefore, nearly the entire mortgage payment might be tax-deductible. It’s important for landlords to take a look at their mortgage statements each month and track the interest they are paying. Often, at the end of the year, the bank will produce a statement showing the amount of interest paid during that timeframe. Keep that record of receipt so you can be sure to deduct it on your tax return this July.

 

For landlords, these are some of the biggest tax deductions available, yet many of them are often overlooked..Therefore, you need to make sure you take advantage of every tax deduction to which you are legally entitled. For the most thorough review of all your available tax deductions, consider hiring the services of a CPA.

What is a Row House?

As you read in our previous blog post, we’ve started investing in the beautiful city of Baltimore. We’ve already sold our first supply of Baltimore turnkey rentals, but we have several more that are currently being renovated. They’ll be available to our investors shortly. Like the previous two Baltimore turnkey rentals that we sold, the upcoming rentals are also row houses. Depending on where you live, you may not have row houses in your city. But in Baltimore, row houses have a distinguished history of charm and elegance. Here’s more information about what row houses are and why they’re so desirable.

What is a Row House?

A row house is defined as a residential dwelling that shares at least one wall with an adjacent dwelling, shares a roof line, and is similar or identical in exterior appearance and interior layout to its neighbors. A row house is sometimes called a brownstone, in which case a brownstone façade has been added to the front exterior of the row house. You may also have heard the term “terraced” houses, which is another way to describe a row house. Townhomes are very similar to row houses, but may only consist of two dwellings, whereas a row house is generally part of a row of multiple residences.

 

If you’re trying to picture a row house, there are some great cinematic examples. In “You’ve Got Mail,” Meg Ryan’s character, Kathleen Kelly lives in a row house. In “Something Borrowed,” Ginnifer Goodwin, Kate Hudson’s foil, resides in a row house. Opening scenes of older TV shows like “All in the Family” and “Full House” featured images of quintessential row houses. You can also review the two Baltimore turnkey rentals we just sold to see what row houses look like in real life. Once you visualize what row houses look like, you’ll start noticing them everywhere, particularly in large cities on the Eastern seaboard, like Baltimore.

 Why Are Row Houses Considered Desirable?

Everyone appreciates the value of row houses. Investors love them because they are historical, highly rentable and can offer excellent ROI. The layout of row houses lends them to larger square footage, since the living areas will be two, three or even five stories high. In fact, if you look at the square footage of the Baltimore turnkey rental on 32nd Street that we just sold, you’ll see that the square feet is 1,428, and it comes with 3 bedrooms and 1.5 bathrooms. The lucky investor who scooped this up can get $1,500 in rent, and a 15% ROI.

 

Renters love row houses because they are historical and typically have very charming features like wide front porches, nooks and crannies, arched doorways and things that make a house feel more like a home. Row houses also promote a sense of community, since front porches and common areas are in close proximity, and they provide a greater amount of living space for families than an apartment or a detached single-family home.

History of Row Houses in Baltimore

The first row houses in Baltimore were constructed in the late 1700s. Baltimore’s architects drew inspiration from England, where rowhouses often surrounded neighborhood parks and provided housing for the middle class. As the population of Baltimore grew, more row houses were erected that families of every income level could afford. The 1850s saw a boom in the rail industry in Baltimore, and thousands of Italian immigrants needed housing, so the three-story “Italianate” row houses were built. These featured ornamental elements that were easily mass- produced, in keeping with row house “identical” stylings.

 

When motor cars became a frequent sight, more row houses began cropping up along street car lines, farther from the city center. The economy was flourishing and the new row houses reflected a more unique and colorful look than their utilitarian predecessors. As timed moved on, row houses became the default residential construction method and they can be found throughout Baltimore, marking each era of growth.

 

Like most cities, Baltimore is comprised of neighborhoods, each one with unique architecture that is indicative of a particular time in history. For our purposes, we have identified areas of Baltimore that offer the most value for our investors, both now and in the future. We look forward to offering you more chances to invest in Baltimore! Please be on the lookout as we bring you more Baltimore turnkey rental investment opportunities!

Why Invest in Baltimore?

Yesterday we broke the news that MartelTurnkey has is offering new opportunities in Baltimore. We’ve done our due diligence and determined that Baltimore is the next great place for real estate investors. We think you’ll agree after you’ve read through our list of great reasons to invest in Baltimore!

Baltimore Through the Years

Settled in 1661 by English settlers, Baltimore was held in high esteem during the Colonial era. As one of the largest cities in the nation, Baltimore was once considered a suburb of Washington D.C. Like many D.C. suburbs, though, Baltimore suffered from high crime statistics, a dwindling population and declining property values.

Baltimore Population Poised For Growth

Baltimore has turned a corner. As the city with the highest population in Maryland, Baltimore retains its stature as a leading city with a population of about 600,000. After a period of decline, the numbers are flattening out, and we see this as a good sign to get in now with real estate investing.

Baltimore Economy Heavily Diversified

Another factor that we look at when considering investing is the diversity of the economy. We dislike investing in areas that rely heavily on only one segment of economy, because if that fails, it can take down the entire city, as we witnessed in Detroit.

 

Baltimore’s economy is known for being very diverse. As Michele Whelley, president and CEO of the Economic Alliance of Greater Baltimore says, “Greater Baltimore benefits from the diverse industry sectors that drive its economy.”

 

It has large employers like Johns Hopkins University, University of Maryland and Johns Hopkins Hospital, as well as a bevy of higher education institutions like the U.S. Naval Academy and Loyola University Maryland. Household brand names like McCormick, Under Armour, Legg Mason and T. Rowe Price have their headquarters in Baltimore. Four Fortune 500 companies are also headquartered in Baltimore: Lockheed Martin, Marriott International, Discovery Communications, and Host Hotels & Resorts, which is real estate investment trust.

Property Values Are Steadily Increasing

Property appreciation is a key indicator whenever you’re looking at places to invest in real estate. In Baltimore, home values have increased over 33% in the past year, with predictions of a further 10.5% in the coming year. In the past ten years, Baltimore real estate has shown a consistent rise that is indicative of a steady growth that’s ripe for the picking.

Baltimore’s Diverse Workforce Means Plenty of Tenant Candidates

Baltimore’s workforce offers investors a large pool of tenant candidates. The key industries in Baltimore include no fewer than seven areas, ranging from bio & life sciences, the military sector, financial services, energy sector, advanced manufacturing and more. These are all higher-paying industries, which translate to high quality tenants for your investment rentals.

Excellent Baltimore Schools Attract Stable Tenants

Another indicator we like to analyze is the quality of the school system. Maryland ranks second in the nation in educational excellence. The public school system in Baltimore ranks in 8th place in the country and Johns Hopkins University ranks 10th in the nation. As a savvy investor, you know that great schools are one of the first things that stable tenants with school-aged kids look for.

Millennials Are Flocking to Baltimore

You can tell a lot about the real estate investment potential of a city by looking at the movement of entrepreneurs and the younger generations. According to the latest statistics, millennials are flocking to Baltimore in droves. The millennial population has grown over half in the last decade. Downtown Baltimore is a magnet for millennials who desire young, hip and diverse neighborhoods in which to thrive. Baltimore is ranked in the top 10 cities in the entire country for startups, and ranked number one for the most employed PhDs and engineers, another great sign for investors looking for financially stable tenants.

 

Over the coming months, we plan on bringing you even more opportunities to invest in Baltimore. We see Baltimore as being still in the early stages of growth, and there’s plenty of room for you to get in on the ground floor. Take a look at our latest Baltimore turnkey rentals for yourself and you’ll see what we’re talking about!

 

 

 

How We Are Managing Amid the COVID-19 Pandemic

As COVID-19 continues to tighten its grip on the world, we at MartelTurnkey are carrying on with business as usual, with a few differences. We wanted to take time this week to share with you some of the ways in which we have demonstrated the flexibility of our company to ride out whatever hurdles the market can bring to bear. As you’ll see, we are more committed than ever to adhering to our original mission statement of making the highest quality turnkey rental properties available to our investors.  

Following No Contact Best Practices

We have altered our property viewing protocols in order to adhere to no contact best practices. When a prospective tenant sees one of our turnkey rentals online that they are interested in, they can click on the “I’m Interested” button. That’s always been the case. However, rather than have them meet with a leasing agent at the property, we’ve implemented a new process. After they click the “I’m interested” button, on the next screen they can make an appointment to view the property. When they arrive on the designated date, they’ll find a lockbox on the door. They’ll receive a text message on their phone at their appointment time with the lockbox code. They can then tour the unit by themselves—no contact. They then leave and return the key to the lockbox. The prospective tenant then receives an email asking if they would like to fill out an application for the property. The rest of the process is completed entirely online.

Protecting Our Contractors

Our property contractors are still working hard, but with fewer workers at any one time. This enables them to more easily adhere to social distancing protocols while on the job. We have also equipped each of our contractors with official company letters stating that they are doing essential work, in the event that they are approached by law enforcement while en route to or from the turnkey rental property site.

Our Virtual Team at Work

The MartelTurnkey family team has always worked in a virtual office environment. Each of us have fully equipped home offices and access to a secured intranet of software applications and documents that enable us to conduct all aspects of our business from the safety of our homes. In the past, we did sometimes make a point of joining together in person to meet for quarterly meetings. However, in light of the COVID-19 pandemic, we have decided to take advantage of online conferencing software for our weekly and quarterly meetings. This has proven to be just as effective and even more convenient than meeting in person.

Protecting Our Assets

Rather than blindly rush forward, we are taking a managed approach to growing our company. We have dozens of turnkey rental properties either under contract or under construction, and we are maintaining a steady supply in balance with demand from our investors. In other words, we are still buying properties as long as demand warrants it, but we are holding back on buying new properties until existing inventory is sold. This cautiously optimistic attitude has served us in good stead so far. In fact, this month is set to be our biggest sales month so far!

 

It’s clear that our investors agree with us that now is the best time to invest in real estate, especially in light of the historically low lending rates and growing demand for rental units in our key markets as companies in the healthcare and shipping sectors continue to expand. Of course, it’s impossible to predict the future, but we continue to be bullish in our outlook over the next ten years or so. Whatever turbulence lies ahead, we are confident that by following guidelines and being steadfast and sturdy, we can weather any storm.

Single Family Vs. Duplex

Many first-time investors are attracted to duplex turnkey properties over single family turnkey rentals. They may have heard that duplexes cash flow more than single family homes, or they may just like the idea of owning a larger property. It’s true that duplexes tend to produce higher cash flow—at least on paper—but there’s much more to the story. Both options can make great investments, but before you decide to buy either a single family home rental or a duplex turnkey, here are the differences you need to know about.

Operating Expenses

Operating expenses comprise things like electricity, water, gas, sewer, waste management and lawn care. When you own a single family turnkey rental, you can easily pass on the operating expenses to the tenant. Tenants of single-family home rentals expect to pay most or all of the utility bills. They also typically expect to be responsible for lawn care and upkeep. Passing these operating expenses on to the tenants ultimately results in higher cash flow for you, the owner.

 

When you rent out a duplex or fourplex, it becomes harder to pass off all the operating expenses to the tenants. Since there isn’t just one primary tenant, neither will want to bear responsibility for mowing and trimming the lawn. In addition, older duplexes and fourplexes often have only one water valve, making it very complicated to try and split up the water bill. The same thing goes for gas, electricity and sewer and waste expenses. What happens is that the owner ends up carrying most or all of the utilities. This isn’t always the case, but it does happen often enough that you need to be aware of it.

 

When you choose to buy a duplex turnkey—or any turnkey, for that matter—carefully review the cash flow so you know ahead of time what utilities are paid by the tenants and which will be paid by the owner.

Rental Rates

Typically, the rents charged for duplexes, triplexes and fourplexes are lower than for single-family homes. For instance, we sold a triplex in Cleveland that rents out for $1975, but that’s split among three residences. In comparison, a single-family turnkey property in Cleveland, which we also recently sold, rents out for $925 for one tenant family.

 

The trick when looking at the numbers for both duplexes and single family home rentals is to make sure you’re comparing duplexes to duplexes, triplexes to triplexes and single family homes to single family homes.

Tenants

There are even more differences between duplexes and single family home rentals to be aware of; even the type of tenants you get will be different. As you might imagine, you’re going to get a different kind of tenant in a duplex when the rent is only around $600 or $650 per unit. Generally speaking, a duplex tenant might be a college student, a young unmarried couple, someone who is struggling financially or a person who is trying to get back on their feet after a divorce or some other setback. It’s typically not going to be someone who wants to stay long-term and make a home.

 

A single family home rental tenant is more likely to be a family with kids or a committed couple who are looking for stability and community connections. This makes them a) willing to pay a little more for rent and b) more likely to stay multiple years. Both of these characteristics make them more desirable tenants from a landlord’s perspective.

 

One thing that balances out this difference is that duplex owners have a much greater pool of prospective tenants to choose from. You might have less desirable tenants, but you’ll never be short of applicants.

Vacancy Rates

That brings us to the next big difference between duplex turnkey rentals and single family rentals, which is vacancy rates. Because you get more single tenants and fewer family tenants, you’re going to encounter higher vacancy rates with duplexes. That’s not to say that duplex tenants will run out on their leases, but generally speaking, they may be less likely to stay longer than one year.

 

On the flip side, a happy tenant in a single family turnkey rental is much more likely to renew their lease again and again. They may have kids in school, a career rather than just a “job,” and other ties to the area that make them want to stay right where they are.

 

One easy way to get around this is to have your duplex tenants sign two-year leases instead of one-year leases. This simple practice can drastically cut down on your vacancy rates.

 

Duplexes, triplexes and fourplexes are still very desirable in terms of real estate investing. It’s just that there are definitely differences between them and single family rentals that you want to be aware of ahead of time. If you’d like more information about investing in duplexes or single family turnkey rentals, please contact us. We’re always happy to answer all of your questions.

Why You Can Continue to Put Your Trust in Us

The COVID-19 virus has shaken the faith of nearly every citizen on the planet. Every morning, we wake up to increased restrictions on movement and activities, and the human statistics seem to worsen with each passing hour. This global crisis is certainly testing our strength as individuals and as a civilization.

 

Throughout this pandemic, all of us at MartelTurnkey have worked hard to persevere in our mission to serve our investors. We have made adjustments where necessary and exercised flexibility without surrendering our high standards for quality and customer service.

 

In this time of crisis, it’s important to try to maintain a modicum of normalcy so that when it’s over, we can all get back to living and working as before. We want to let you know that our turnkey rental company remains operational even during this pandemic of epic proportions. We have projects in the works that are still moving forward, properties that are currently being rehabbed and turnkey rental properties available for our investors to buy. To quote Antoine, “Thankfully, the COVID-19 virus has actually not hurt our business at this point. We are still seeing a large number of tenants looking to move into our rehabbed properties, and since the interest rates are very low our buyers are buying up investment properties faster than ever.”

Our Journey to This Point

As you may know, we began MartelTurnkey with one goal in mind; to help our family and friends reap the amazing rewards of earning passive income through turnkey rentals. Our family and friends have grown exponentially over the years; largely, we believe, due to the value we place on them and how we treat them. We now consider you a part of our family and friends.

 

Our journey to this point hasn’t always been smooth. We’ve encountered all kinds of challenges along the way. But as a family company, we’ve always found a way to push through and move forward. We learned how to overcome adversity, together. Now is no different. We are still finding ways to push through and move forward during this challenging time, and we want you to know you can continue to trust in us.

Why Real Estate is Still Your Safest Investment

One of the things that seems to be so rocky during these times is the stock market. One day your portfolio has doubled overnight, and the next, your portfolio is in the negatives. It feels like it’s all based on the public’s level of panic that day. One frightening announcement from our leaders can entirely wipe out your investment. That’s a risk that we don’t think you should have to face, on top of everything else.

 

On the other hand, real estate is still a fantastic investment option. Mortgage rates are at their lowest right now, and lenders are eager to make deals. If you’ve ever even considered investing in real estate, now is definitely the right time to do it. Those low interest rates you keep hearing about? You can lock in that low rate for the next 20 to 30 years, no matter what the future holds. Right now, you have an opportunity that you’ll never see again, to start or build a real estate portfolio. This really is a once in a lifetime chance to lock in historic low rates.

Why You Can Trust MartelTurnkey Specifically

We know there are other turnkey companies out there vying for your attention. But our company is unique, and our investment properties are better. Why? For one thing, our turnkey rental properties are more affordable for tenants. This means fewer and less frequent vacancies for you, the landlord. Our tenants can typically pay their rent on a modest income because the rentals are in affordable neighborhoods with modest rental rates. Other turnkey companies may boast class A properties in expensive neighborhoods, but when those white collar tenants can’t pay their multi-thousand dollar rents, it’s the landlords who get stuck with the mortgage payment. And now, more than ever, you want a property that is affordable, near reliable job opportunities that pay decent wages. That’s what you’ll find at MartelTurnkey. That’s what we offer our investors, and that’s why 80% of our investors are repeat customers.

 

We know these are scary times. But we also know this is temporary. Eventually it will all be over and the interest rates will go up again. We don’t know how long it will take the stock market to recover, but we do know you can still start earning passive income from day one with your investment in a MartelTurnkey rental investment right now.

 

We’re going about our business, every day, and we’ll continue to be here for you. Please contact us any time with any questions or comments you may have. From our family to yours, stay healthy.