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These Turnkey Rental Markets Are Going Strong

MartelTurnkey offers turnkey rentals in markets around the country and we’re constantly monitoring their status. Lately, we’ve seen a big upswing in the turnkey rental market viability of many of the markets where we offer properties. In particular, Detroit, Memphis and Cleveland are looking rosier than ever. Check out the latest news headlines we’ve seen:

 

Detroit, Michigan

 

The Detroit, Michigan turnkey rental market has already proven itself to us. MartelTurnkey has several properties available in Detroit, and we plan to offer many more. But even we were impressed with the latest news coming out of Detroit. Just this past Thursday, Stellantis NV, maker of the popular Jeep Grand Cherokee SUV, opened its newest assembly complex right on Mack Avenue in Detroit. It’s the culmination of an impressive three million square-feet complex construction project that flew under the radar during the pandemic. They even launched into production mode while still under pandemic restrictions in March of 2021.

 

Just this one assembly complex comes with almost 5,000 jobs for the good people of Detroit. In fact, the plant manager, Michael Brieda, the plant manager in Detroit, says that their biggest challenge has been finding workers accustomed to “working in a manufacturing environment.” To vet applicants, the plant gave candidates dexterity tests as part of the interview process. That’s pretty cool, considering that good dexterity isn’t something that comes with a college degree. For Detroit turnkey rental investors, that means that tenants with only a secondary education could be viable candidates for these jobs. There are still almost 3,000 job spots to fill, since only around 2,100 Detroit residents have been hired so far.

 

Good news, right? And that’s not all! The complex on Mack Avenue will also have two adjacent factories in Detroit that will be building half a million or so Jeep Grand Cherokee models each year. So, whether you happen to be in the market for a Jeep Grand Cherokee or you’ve been crossing your fingers for the turnkey rental market in Detroit, MI, your wish has been granted! Detroit is now officially “Jeep City.”

 

Memphis, TN

 

As a turnkey rental market Memphis, TN has long been our favorite for many reasons. The first turnkey rental properties we ever sold are located in Memphis. And anyone familiar with Memphis knows that Graceland is located in Memphis, in a neighborhood known as Whitehaven. Well, recently, Whitehaven made the news because of an exciting new development. A new, multi-million dollar movie studio is coming to Whitehaven!

 

The state-of-the art film studio is closer to being a reality, thanks to plan approval by the Land Use Control Board of Memphis. Next, it will go to the Memphis City Council for final approval. Memphis City Council has a long reputation for supporting positive impact development projects that come with jobs for Memphis residents, so we think this will be a slam dunk.

 

The film studio will be situated on the corner of Elvis Presley Boulevard and Scaife Road, a fitting location since Elvis himself did his share of movie roles. The project is headed up by Jason Farmer, founder of BLP Film Studios and his partner, Carolyn Henry. The plan is to work with local and national filmmakers with small to medium-sized budgets. Beginning with a modest one to two quality films per year, the ultimate goal is to get to 40-50 films per year in the future.

 

As to the physical size of the project, it will have 12 sound stages, ample editing rooms, on-site private housing, plus a hotel. All told, the film studio will create over 500 jobs, not to mention all the construction work while the studio is being built. That’s amazing news for both blue collar workers in Memphis, skilled entertainment job candidates and creative filmmakers in the Memphis region!

 

Cleveland, OH

 

The new White House Administration’s $2 trillion infrastructure package might just benefit Cleveland, Ohio in a major way. Amtrak just released its potential plans to connect the four major Ohio cities, Cleveland, Columbus, Dayton and Cincinnati with new rail lines. Business owners in Cleveland would benefit immensely by driving up sales, which would increase labor and production needs. It would also benefit the city in general, making Cleveland more accessible and attractive as a home base for commuters who want to live in the area but need to work farther out. The plan fills a transportation gap that has existed since Amtrak first became operational. If Amtrak gets the $80 billion in funding in federal aid, your already valuable Cleveland, OH turnkey rental investments could go up in value even more! We’ll keep you informed as to the development of this transportation news.

 

We’re especially proud of our team for having identified these profitable turnkey rental markets early on. We’re always looking and evaluating markets to bring our investors the best opportunities for single-family and multi-family turnkey rentals. What makes us the happiest is when we see that our instincts were spot on. When you’re ready to make your investment dollars work for you, take a look at our turnkey rentals for sale in Detroit, Memphis, Cleveland and other markets. We look forward to working with you!

 

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Exactly What Happens When You Buy a MartelTurnkey Property

One of the most common questions that people ask is exactly what happens when you buy a MartelTurnkey property. Because we are committed to full transparency, we thought it would be a nice idea to take you through the entire process of buying a MartelTurnkey property, step by step. From the beginning stage of choosing a turnkey rental property from our website, all the way to closing day, here’s what you can expect. 

 

Choose a Turnkey Rental

 

The first step is to browse the available turnkey rentals for sale on our website. You’ll find a selection of turnkey single-family homes and duplexes in our current markets of St. Louis, MO, Cleveland, OH, Memphis, TN and Detroit, MI. Future markets might become available as various economic indicators dictate. The way to choose a turnkey rental is to download the financials. The link to do this is on the individual property page. You’re asked to enter your contact information, which just puts you on our mailing list. You’ll then receive an immediate email with the financials for that property. One or two business days later, you’ll receive a call or email from our team asking if you’re interested in moving forward with that property. This gives you the opportunity to get any of your questions answered or ask for more information. Once you’ve reviewed the financials and determined that a certain turnkey rental property aligns with your investment goals, it’s time to move on to the next step!

 

The Contract

 

Once you decide that you want to move forward, the sales team will email you the contract for the property. This is essentially a Purchase & Sales Agreement. (Note that you do not need to have real estate agent representation to do the transaction.) After you’ve reviewed the contract, you sign it using an online e-signature service called Zoho Sign, and return it to us via email. Your signature does not have to be notarized. You can just take care of it in the comfort of your home via email. You’ll then receive a fully executed copy of the Purchase & Sales Agreement. At this time you’re entered into our system as the buyer for the turnkey rental property. 

 

Submitting Your Earnest Money

 

Within five business days after you sign and return the Purchase & Sales Agreement, you’ll need to submit your earnest money to seal the deal. We only ask for $1,000 in earnest money on our properties, which is on the low end of the standard earnest money requirement. Of course, if you complete the sales purchase, that earnest money is put toward your purchase price on the turnkey rental. The earnest money is sent to the Title Company to be held in escrow. Instructions for how to wire the money will be emailed to you at the same time as you sign the Purchase & Sales Agreement. 

 

Personal Introduction to Your Team

 

Within a day or two, you’ll receive another email from us, introducing you to your team. This includes your title company, property manager, the property insurance company and the lender. Note that these are the companies that we work with; the companies that we have established relationships with. You are under no obligation to work with these companies. You can always choose your own property management company, insurance company and lender. However, by working with our recommended companies, the entire process is greatly streamlined, since they know how we work and they understand the turnkey rental property business. 

 

Getting Approved For the Loan

 

When you buy a MartelTurnkey property, there’s really no pre-approval process like when you would buy a primary residence. The way it works is like this: After you have signed the Purchase & Sale Agreement, we approach our lender and say, “Hey, can we get them approved for this loan?” At that point, the lender will contact  you and ask you for all the information they need to process your loan application. They’ll ask for things like:

 

  • W-2 income or 1099 income
  • 2 Months’ Bank statements
  • 2 Years’ Tax returns
  • Credit Score
  • Credit Check

 

This will be the time when you’re working in close contact with the lender; answering questions, supplying more documentation, etc. 

 

What if You’re Not Approved?

 

In rare cases if the buyer can’t get approved, then we cancel the Purchase & Sale Agreement and return your earnest money, no strings attached, no harm, no foul. If you get the opportunity to improve your credit and think you can get approved in the future, we would welcome the chance to work with you again and hope you’ll return to us. But let’s go on with our scenario with the assumption that the lender has given you the green light and you’re approved!

 

What if the Property is Still Being Renovated?

 

We try to make our turnkey rentals available for sale as soon as possible. Sometimes this means that renovations are still underway. If you choose to buy a property that’s still being renovated, you’ll want to lock that purchase up and not wait for it to be completely renovated, so no one else buys it before you can. You can always view the list of renovations on the property details page on our website. So even if those renovations aren’t finished, you’ll know exactly what will be complete before you take ownership. 

We can go ahead with the purchase process, including setting a closing date. Closing dates are typically 30-60 days out. That gives us a chance to finish the renovations and get a tenant in place for you. All of our turnkey rentals transfer with a tenant. You’ll also receive a set of professional photos that reflect the condition of the turnkey rental after the renovations have been finished. That way, you’ll see the finished product before the closing date. 

 

What if We Can’t Get a Tenant Before the Closing Date?

 

In this case, there are two options to proceed. We can ask you if you want to go ahead and close with no tenant in place and then give you a check to cover the first month’s mortgage and interest. Or, you can ask us to push the closing date until a tenant is in place. In almost all cases, it only takes one month to get a tenant signed, so that would push the closing date out 30 days. 

 

The Appraisal Process

 

Once you’re approved, the lender will order an appraisal. The appraisal is a third-party assessment of the value of the property. It’s required to ensure that the property is worth the price. You pay for the appraisal, which is about $500. The appraisal takes the most amount of time, but it’s the last check, so you’re getting closer to being a landlord! Once the appraisal comes back, then the deal moves to closing.

 

Covering the Property With Insurance

 

Once you’re approved, you’ll need to contact the insurance company to acquire property insurance. This needs to happen before the actual sale takes place, since the lender needs to know that the insurance on the property won’t have any gaps. Property insurance in our markets generally runs about $500 to $800 per year. 

 

Behind the Scenes

 

After the appraisal comes back and it’s in line with the purchase price, the bank works with the title company. A closing date is set up, and the title company will then email you to see if you’re available at that date and time. 

 

The Title Company and You

 

You’ll need to have your signature notarized on all of your closing documents, so  you’ll need to set up the meeting with the notary ahead of time. The title company can either email you the closing documents, which you can print out and have notarized and then overnight the documents to the title company. Or, you can ask the title company to email the documents to a local notary, arrange to have the notary come to your home and notarize your signature on all the documents, and then the notary can overnight the documents to the title company. Basically, you can do this part the DIY way or the concierge way.

 

The Last Step

 

The last step is that you need to send in your wire for closing. This will be part of your closing documents. The wire goes to the title company and it represents your down payment portion. Meanwhile, the bank is doing the same thing. They’re sending in their wire transfer to the title company for the loan amount. After the title company does all the math and the accounting, they then record all the documents and forward the money to the seller, MartelTurnkey. Once everything is finalized and “closed and funded,” all the parties get a congratulatory email from us saying that the transaction has been fully closed. You’ll be named as the buyer and the new owner of the property!

 

What About the Keys?

 

When you buy a turnkey rental property, the keys are held by the property management company so they can do their work. As the new owner and recipient of passive income, you don’t need to do so much as keep track of the keys. All that is done on your behalf by the property management company!

 

Now that you know exactly what happens when you buy a MartelTurnkey property, you’re probably excited to get started. The first step is perusing our selection of properties and choosing one that appeals to your needs. Remember, we’re with you every step of the way on this journey to generational wealth. If you have any questions, please don’t hesitate to contact us!

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Questions To Ask Yourself Before Investing In Real Estate

As today’s real estate market continues to gain in strength, profitable investment opportunities in turnkey rentals abound at MartelTurnkey.  Because of this, you may have decided to finally take the plunge and become a serious real estate investor.  But since you want your hard-earned money to give you returns and grow in value year after year, you’ll want to take a look at the many factors to consider, such as whether you want to invest in single family turnkey rentals or duplexes, where you want to invest, what your expectations are and which company you should work with.  Before jumping into the real estate investment game, ask yourself the following important questions so that you’ll be better poised for success.

 

What are Your Investment Goals?

 

While the obvious answer to this question is to make money, no two investors are exactly alike.  Therefore, always carefully examine your main real estate investment goals.  For example, if monthly cash flow is your goal, a turnkey rental income property would be your best option.  Are you looking to buy property in a certain market? If so, make sure whichever company you work with offers properties in that region. However, be sure to choose your market based on economic indices and not emotions. Your hometown might always hold a special place in your heart, but that doesn’t necessarily make it a profitable market in which to invest in turnkey rentals. Align your investment goals with your decisions so that you can be sure you’re on the right path for you and your family.

 

Do You Want an Active or Passive Investment Experience?

 

Once you establish your goals, you should then move on to deciding if you prefer to be an active or passive real estate investor.  Should you be a person who already has plenty of personal and professional responsibilities, you will likely want to focus on passive investment opportunities.  In this case, turnkey rentals are ideal. However, if you are a person who has plenty of free time, wants to be involved with every detail of your investment properties, and likes being hands-on from day one, you might be happier with active real estate investments such as fix and flips, or BRRRRs. 

 

What Resources Do You Have for Investing?

 

While you’re of course excited about your real estate investment adventure, you also need to be practical and know the resources that are available to you.  As an example, if you decide to invest in fix and flip single-family rentals located outside of where you live, make sure you have the resources needed to scout out neighborhoods, hire workers, and take care of the many other details required to make such an investment profitable. If money is your primary resource and time is scarce, you will likely be more suited to the turnkey rental experience, where you can go about your own life while others take care of your investment concerns. 

 

How Much Liquidity Will You Need?

 

In many cases, investors fail to take into account exactly how much liquidity they will need.  If you do the same, you could experience an unexpected cash crunch.  If you have a limited amount of money to use for your real estate investments, consider finding ways to increase your investment funds or look to more affordable options. Our turnkey rentals are available for a standard 20% down, but that amount can start as low as $25,000. If you have less right now, contact us and we can help you by putting you on the VIP mailing list and letting you know as soon as something becomes available in your price range. When you buy a turnkey rental from MartelTurnkey, you get a property that’s been fully renovated, so it’s highly unlikely you’ll need to spend any more than your down payment for the foreseeable future. 

 

What’s Your Risk Tolerance?

 

Risk tolerance is typically determined by such things as age, financial position, and your goals.  For younger investors, higher-risk investments are considered safer and preferred, while older individuals planning for retirement may be better suited for steady, low-risk investments.  Real estate in general is considered to be highly stable as an investment. Turnkey rentals are also very conventional, stable investments. If you’re interested in doing your own fix and flips, you’ll take on more risk, incur more expenses and spend time as well as money. In return, you may get a higher rate of return, but only if you’re able to sell in a timely manner and at a profit. Those are risks that not everyone is willing to take. 

 

How is the Current Market?

 

To be a truly smart investor, carefully examine the current market conditions.  If there is one thing you don’t want to do, it is to go against the market.  By following the latest trends that seem to be favoring certain types of investments, you can formulate a strategy that will bring your investment goals to fruition.  Right now, real estate remains one of the most lucrative investments. Home prices are rising, but interest rates are still very low. If you’ve been on the fence about taking the leap, now’s the time to act.

 

Which Real Estate Investment Company Will You Work With?

 

Finally, before you go all-in on your real estate investing, carefully vet any investment company with whom you’re considering doing business. As we’ve written about before, not all turnkey rental companies are the same. MartelTurnkey is a family business with a solid reputation, and we have numerous references and testimonials to prove it. Of course, we hope you work with us. If you have any questions about us, the way we do business or any of our properties, please don’t hesitate to contact us. You’ll speak with a real member of our team; we don’t outsource to some call center, and we don’t try to keep our conversations as brief as possible. As long as you have questions, we’ve got the time to answer them.

 

Since many people around the world have made their fortunes through real estate investing, there’s no reason to think you can’t do the same.  By asking yourself these questions beforehand and giving yourself honest answers to each question, your real estate investment adventure can begin!

 

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Benefits of Investing in Duplexes

When it comes to investing in turnkey rentals, you can’t go wrong with single-family homes. More than any other kind of rental; such as condos or apartments, single-family homes can bring in a high return-on-investment (ROI), and are very popular with tenants who have families and want a place to rent long-term. But another kind of lucrative property investment is the duplex. Duplexes are also popular with quality tenants and carry with them lots of benefits that you don’t necessarily get with detached, single-family homes. 

 

Rent Out Multiple Units

 

When you invest in duplexes, you get the potential of double rental income. You can rent out both sides of a duplex and all three or four units of a triplex or quad. This typically makes your ROI higher and it definitely makes your rental income higher than a single-family-home rental.

 

You Could Live in One Unit

 

Most—okay, all—of our MartelTurnkey investors are out-of-state. Many of them have never been to Memphis, Cleveland or St. Louis, let alone lived there. However, if worse came to worse and you owned a duplex, you could live on one side and rent out the other. Plenty of landlords have done it, and it’s a viable way to cut living expenses while earning some income.

 

Your Maintenance Costs Are Lower

 

Having multiple units under one roof means you have…only one roof. Down the line, if you find yourself needing said roof, there’s only one to replace. Ditto for landscaping costs, pest management, HVAC and more. Your property manager will still charge you a percentage of your rental income, but when it comes to buying materials, you’ll see a savings with a duplex.

 

Easier to Track

 

Even with property management in place, you still need to keep records and track details on your investment properties. When you invest in duplexes, you have one less building to keep track of, even though you have the benefits of two rental incomes. When your portfolio becomes expansive, you’ll appreciate even one less property folder on your desktop. You’ll also have fewer reports from your property manager, since both units will be included in all of your monthly property management reports. 

 

Less Risk During Vacancies

 

Many of our MartelTurnkey investors tell us that they choose to save their monthly rental income to put toward future turnkey rental purchases. That’s smart thinking, but not everyone has that luxury, especially right now. If your turnkey rental income has become an important part of your family’s monthly income during the past year, you’ll feel the strain if or when you have a vacancy. But when you invest in a duplex, you carry far less risk. You might have one tenant leave, but you’ll still have one income coming from the duplex. It will probably be enough to cover your mortgage and other expenses, too. That’s a big relief if you happen to be recovering from some financial setbacks due to the pandemic.

 

Most of the MartelTurnkey turnkey rentals are single-family homes. But occasionally we do have a duplex to offer our investors. We encourage you to consider investing in duplexes in the future, to help diversify and round out your investment portfolio. As always, feel free to contact us with questions or comments!

 

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Rules From Some of the World’s Greatest Investors

When you decided to become a real estate investor, your first thought was, of course, to make as much money as possible. The most successful investors accomplish this goal by having a strategy and a set of rules and sticking with them. While you may already have some ideas as to how you can be a successful real estate investor, it never hurts to seek out the advice of those who have proven themselves to be exceptional in their field.  Following are a few words of wisdom from some of the world’s greatest investors that you can use to grow your own financial portfolio.

 

Dennis Gartman:  Let Winners Run

 

A frequent guest on TV financial shows, investor Dennis Gartman has made a name for himself over the years by showing beginning investors how to make investments for the long-term, rather than do a quick dash for cash. According to Gartman, investors should never sell as soon as they start to see a profit.  Instead, he recommends learning to be patient while investing, since it’s okay to lose a small bit of money now and then in the march toward long-term gains.  Also, he likes to remind investors that they don’t have to be correct each and every time.  In fact, he says you can make money by being right only 30% of the time.  Therefore, if you’re like a baseball player and have a .300 batting average, chances are your portfolio is growing the way it should. 

For turnkey rental investors, you can apply this strategy by buying and holding property so it has a chance to appreciate over time while bringing you passive income in the interim. 

 

Warren Buffett:  Do Your Research

 

One of the most successful investors in history, Warren Buffett is held in such high regard that when he speaks, world leaders listen.  As for the secrets of his success, he credits doing exhaustive research with being a key component of building his wealth. If you want to be like Buffett, do as he says and ask plenty of questions prior to purchasing a piece of investment property or selecting a turnkey rental investment company. At MartelTurnkey, we always espouse doing your due diligence before making any investment. When you want details about any of our available turnkey rental properties, you can instantly view and download the financials so you know exactly what to expect. You can also always reach out to us and speak to a real, live member of our team who will take as long as necessary to answer all of your questions. 

 

Bill Gross:  Have Conviction

 

If there is one thing Bill Gross hates to see happen to investors; it is “analysis paralysis.”  Since this is something most of us have experienced at one time or another when faced with an important decision, you know how this frame of mind can keep you from pulling the trigger on what may be an exceptional opportunity.  

 

While he does believe in doing research for your investment portfolio, Gross believes you shouldn’t let this idea prevent you from moving on a particularly good investment.  Once you have the facts in hand, and have made sure they align with your investment goals, have the courage of your own conviction to go ahead with your plan. 

 

Prince Talal:  Patience is the Key to Successful Investing

 

Even though you may have never heard of Prince Talal, those in the world of investments know all about him.  Hailing from Saudi Arabia, Prince Talal is a textbook example of an investor who knows that patience is the key to success.  Referring to himself as a “long-termer” rather than a seller, he held onto many of his investments during the Great Recession, even when most others chose to sell.  Since it’s hard to argue with his success over the years, use his advice and don’t be hasty to buy or to sell.  Rather than just buying the first property that presents itself, be patient and wait for a property that is in the right market, being offered at the right price, and will align with your goals while bringing you a nice ROI.

 

Carlos Slim:  Always Look Ahead

 

The owner of hundreds of companies around the world, Carlos Slim is extremely successful and extremely rich.  As to how he got there, his strategy has been to always be forward-thinking.  Instead of focusing solely on one short-term gain after another, concentrate on building something for your family legacy through careful planning.  In fact, he feels the smartest and most successful investors aren’t those who are studying what is happening now, but rather those who are looking at the trends of tomorrow. If you do the same and strive to find the next big winner, your portfolio will be filled with great properties that produce steady growth and income for both you and the next generations in your family.

 

Everyone has to walk their own path to financial wealth. But you can take a page from the most successful investors and adapt them to your own needs and financial plans. Once you take the advice of these incredible investors to heart, there will be no stopping you in the building of a profitable investment portfolio.  From doing your due diligence, putting a stop to “analysis paralysis,” and looking toward the future, you’ll find yourself becoming more financially secure with each passing year. As always, feel free to contact us with any questions or comments you may have.

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Reasons to Invest in Detroit

What do you think of when you think of Detroit? Henry Ford? The “motor city”? Detroit is well-known for a lot of things, but recently, we’ve noticed that Detroit has transformed into a serious opportunity zone for turnkey real estate. We’ve broken down many of the reasons why you should invest in Detroit.

Detroit Development in the Works

 

Detroit has been in urban renewal mode for several years now. Revitalization efforts have been ongoing and planned for the future in many neighborhoods throughout Detroit. Detroit’s mayor is focused on investing in locals—developing existing neighborhoods—rather than simply working on the most visible tourist areas. In fact, Detroit’s plans are so successful that they are now being used as a model for other cities. 

Involved Residents Who Care About Community

 

Governments can spend all kinds of money and have thousands of hours of meetings, but in the end, it’s the community of residents who must put forth the effort to make a neighborhood really great. Detroit has that in spades. Consider the Cadillac Boulevard Block Club, which works with the Eastside Community Network to clean up parks, develop after-school programs for inner city kids and promote sustainable programs like community gardens. There’s nothing better than knowing that you’re investing in an area where the actual residents truly care about their home city.

Diverse Workforce

 

The largest industry in Detroit is trade transportation and utilities; these employees make up 20% of the total workforce. In recent weeks, CEOs of major companies in Detroit have made statements committing to having a diverse workforce. What does that mean, exactly? Well, ideally, diversity should be an organic process, but sometimes it doesn’t work out like that. However, these CEOs are now fully committed to being true Equal Opportunity Employers, giving all qualified job candidates a fair chance. 

Plentiful Large Employers

 

The largest employers in Detroit are GM, Ford, Chrysler, Quicken Loans and Ally Bank. A quick search at online job board Indeed found over 71,000 job listings for Detroit. With so many options, your tenants are bound to find short-term jobs, long-term career opportunities and everything in-between!

The Weather

 

Just kidding. Detroit can boast about a lot of things, but let’s be honest, weather really isn’t one of them. In winter, temperatures can drop well below zero Fahrenheit. Talk about brrrr! Of course, the warm season is long, lasting from May to September. Those months can be beautiful, balmy and breezy, thanks to Detroit’s location between Lake St. Clair and Lake Erie. Make no mistake, Detroit is a highly sought-after relocation destination for many, despite those cold winter temps! In fact, did you know that Detroit is the largest and most populated city in Michigan? There must be some good reasons for that!

Home of 100 Fortune 500 Company Headquarters

 

If Fortune 500 corporations like Kellogg’s, Whirlpool, Walmart and Penske have their headquarters in Detroit (and they do), don’t you think they might know something important? Detroit is ideally situated; it’s a major port on the Detroit River, and according to sources, anchors the second-largest regional economy in the Midwest. You might only know Detroit as the center of the automotive industry in the U.S., but Detroit is also the number one exporting area in the U.S., and the Detroit Metropolitan Airport is considered one of the key airport hubs in the whole country. Who knew? 

Monthly Rent Averages Are Good

 

The average monthly rent in Detroit is $1,050. Of course, rental rates vary depending on several factors. But you’ll find that your Detroit turnkey rental gets a nice rental rate, providing you with positive cash flow that you can bank on. 

Appreciation Potential is Real

 

Homes in Detroit have appreciated 48% in the last six years. Even if you’re not investing in turnkey rentals for the appreciation potential, you can’t ignore the fact that it’s good to see your investment properties grow in value. Whether you decide to sell in later years, refinance or give your heir the best inheritance gift ever, you can almost be guaranteed you’ll be able to reap substantial gains from the appreciation alone!

Four Major Sports Teams

 

You don’t have to be a sports fan to realize that having four major sports teams (Detroit Lions, Detroit Tigers, Detroit RedWings, and Detroit Pistons) in Detroit is a real game changer. After all, sports teams have loyal fans. Fans go to games. Fans follow teams where they play. Fans buy tickets, souvenirs, food and drink. Vendors in Detroit have to meet that need. They need employees to do that. Sports teams translate to more jobs for your tenants. Goal!

Paychecks Go a Long Way

 

A recent ranking by Forbes shows that Detroit is ranked at number three for cities where a $100,000 salary goes the furthest. That indicates affordability as well as sustainability. You want your residents to be able to enjoy a comfortable lifestyle without having to ascend to the financial heights of Mark Zuckerberg and Jeff Bezos!

 

Honestly, this list could go on and on. Detroit has all the signs of a fantastic turnkey rental city, which is why we at MartelTurnkey have taken a proactive approach and started investing in Detroit turnkey rentals. We’ll have more in the future for you to consider, but in the meantime, you can sign up for our VIP mailing list to get fast notifications when new turnkey rentals become available.

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How to Form an LLC

The pandemic has given many people a fresh perspective on how to shore up financials to keep themselves and loved ones safe and secure. While there have always been advantages to starting your own business, never has it been more clear than now, since the government has implemented the Paycheck Protection Program (PPP) for small businesses. Many individuals have suffered financial losses during the pandemic, but it’s small business owners that have the chance to get relief in the form of forgivable loans from the SBA. For this reason, you may be thinking of forming an LLC for your own real estate dealings. If so, read on to learn how to form an LLC.

 

The Benefits of Forming an LLC

 

The primary reason why people form an LLC is to protect personal assets from activity related to financial transactions. In real estate, you may have dealings with other businesses or individuals that could leave you exposed to certain legal complications. This isn’t so much the case with turnkey rentals. Turnkey rentals with MartelTurnkey are set up in such a way that owners are kept far away from personal interactions with tenants. Also, property managers ensure that all laws and regulations are followed. If some legal situation were to develop, the landlord could be certain that no improprieties had taken place. However, we realize that many of our clients have other real estate transactions besides our turnkey rentals. In those cases, forming a corporate veil of protection in the form of an LLC is a prudent course of action. 

 

Forming an LLC also has definite financial benefits, as alluded to earlier. LLCs might qualify for PPP assistance. If the economic woes of the pandemic continue, this could be of comfort, knowing that government help might be available. Another benefit of forming an LLC is the tax benefits. Operating real estate transactions as a qualified business entity rather than as an amateur investor allows for certain tax deductions not available to individual filers. Your CPA can give you the details of the tax benefits of forming an LLC. 

 

How to Form an LLC

 

Forming an LLC is very straightforward. There are specific steps which you take. If you follow them to the letter, you’ll have no difficulty in forming an LLC that you can use for as long as you like. The steps are outlined here.

 

Choose a Name For Your LLC

 

The state where you register your LLC may have rules about what name you can assign to your LLC. Naturally, you can’t use a name that’s already in use; but you may also not be able to use a name that’s markedly similar to another that’s in use. You will also likely need to use a name that ends with LLC, Limited Liability Company, Limited Company, or something similar. It’s not recommended to use your own name for your LLC, since one of the benefits is anonymity. Choose a name that has meaning for you without divulging clues about your identity.

 

Decide Where You Want to Incorporate

 

Depending on where you choose to incorporate, you may benefit from attractive tax laws. You don’t have to incorporate in the state where you reside. Many people choose in incorporate in Wyoming, which is one of the best—if not the best—states to incorporate, due to their affordability and exceptional protection for LLC owners. For ease, we recommend that you just use an agency that can take care of forming your LLC for you. LLCGenie can set you up with an LLC incorporated in Wyoming for a nominal fee. All you need to do is add the incorporation to your cart, answer a few questions and the rest is all done for you. 

 

File Articles of Incorporation

 

If you decide not to use LLCGenie, you’ll need to perform all the remaining steps yourself. The next thing would be to file articles of incorporation in the state where you decided to incorporate. Migrate to that state’s website, where you’ll find templates for the necessary articles of incorporation. Typically, you can file the form online and pay a fee that will range around $100 or $200.

 

Choose a Registered Agent

 

Next, you need to choose a registered agent, but only if you incorporate outside of your own state of permanent residence. If you incorporate in your own state, you can act as your own registered agent. The registered agent is simply an entity that can accept correspondence and documentation for the LLC. It’s basically like a contact entity. The law requires this so that if anyone sues the LLC, they have a name and address to send papers to. There are numerous private companies that provide registered agent services for a small annual charge. If you use LLCGenie, this is taken care of for you.

 

Decide Between Member or Manager Management

 

If just you or you and your spouse will be sole managers of the LLC, then you would opt for Member Management. If you plan to involve outsiders in the management of your LLC, then you would choose Manager Management. Most LLCs are filed as Member Managed.

 

Have an Operating Agreement in Place

 

Although an LLC does provide a corporate veil of protection, the veil can be possibly be pierced if a claimant can prove that the company is not actually being treated like an LLC. One way to prove that the company is being run like a formal LLC is to have an Operating Agreement in Place. The Operating Agreement is just a document that outlines how the LLC will be run, such as who’s in charge of what, what their titles are, what their compensation will be, etc. You don’t have to give this Operating Agreement to anyone unless necessary. Just keep it in a safe place along with the rest of your LLC documentation. You can download Operating Agreement templates from online and then tweak the particulars to suit your needs. For a small additional fee, LLCGenie can do this for you, too!

 

Get an FEIN

 

An FEIN is a federal employer identification number. This number is like a social security number for your business. You’ll use it to file tax returns and to get business credit if you choose to in the future. Even if you have no employees and it’s just you, you’ll still need that FEIN. This is something that LLCGenie can easily take care of for you.

 

Apply For a Business License

 

Depending on where you live, you may need a business license to operate an LLC in your state. Most states require one, if only to increase state revenue. Note that even if your LLC is incorporated in another state, you still may need a business license for the state where you reside, since the actual operation of the LLC will take place wherever you and/or your employees live.

 

Prepare to Pay State and City Taxes

 

Most states and local governments require businesses to pay some form of business taxes. Consult with your local authorities to determine what the mandates are so that you can be sure to comply with all tax regulations. 

 

File Annual Reports

 

Wherever your LLC is incorporated, you’ll need to file an annual report for that state. An annual report can be very complex–as in the case of public companies–or very simple, with just a line stating that you’re still in operation, who your principals are, their titles, the address of your registered agent and the date. Many states even offer a simplified form that takes less than five minutes to fill out. There will be an annual fee each year that you file, which is usually in the range of a couple of hundred dollars or less. If you supply your email address, the state can send you a reminder to file each year. 

 

That’s it. The steps to forming an LLC can be tedious and time-consuming, which is why we suggest you make life simpler by using a service like LLCGenie. But even if you decide to do everything yourself, you can be set up and in business in very little time. Forming an LLC isn’t necessary and it’s not for everyone. But for those who see the need, an LLC can be very convenient and beneficial.

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Why Invest in St. Louis, MO

We have recognized St. Louis as an attractive investment area for investors for a couple of years. But now, things are looking even brighter, especially since the pandemic situation is starting to turn a corner. We curated several fun facts about St. Louis that will hopefully demonstrate to you why St. Louis deserves a serious look when it comes to your investment portfolio. Whether you’re buying your first turnkey rental or looking to bulk up your portfolio, we think you’ll agree that St. Louis is a promising city. Here are some reasons why you should consider investing in St. Louis turnkey rentals.

 

1. High Appreciations.  Within the last three years, houses in the St. Louis area have appreciated in value almost 25 percent, allowing for a high ROI.

 

2. High-Quality Tenants.  Since St. Louis is known for its good economy, emphasis on education, and family-friendly neighborhoods, landlords always have a pool of high-quality tenants from which to choose.

 

3. Excellent Student Housing Opportunities.  With its numerous colleges and universities, St. Louis is a prime area for real estate investors who wish to purchase properties aimed at student tenants.

 

4. Landlord-Friendly Laws.   While tenants of course have rights and protections afforded them by the courts, St. Louis is known as being very landlord-friendly regarding its laws.  Whether it’s evictions, lease agreements, or other legalities, landlords are looked upon very favorably in St. Louis.

 

5. Expanding Suburbs.  In recent years, St. Louis has experienced an expansion of its suburbs and metro area, leading to a higher demand for quality, affordable housing.

 

6. Low Cost-of-Living.  Despite being a large city, St. Louis has one of the lowest cost-of-living rates in the United States, making it very attractive to those who may be planning a move for professional or personal reasons.

 

7. More Renters than Homeowners.  Much to the surprise of many, St. Louis actually has more people renting properties than purchasing them.  According to the latest data, almost 60 percent of the city’s residents rent, rather than own their homes.

 

8. Millennials are Flocking to St. Louis.  Due to its many amenities, millennials are migrating to St. Louis at a very high rate.  In fact, within the next three years, the city is expected to see over 3.5 million new households.

 

9. People Love St. Louis.  Once people are born in St. Louis, statistics show they either spend their whole lives living there or eventually return to their roots after living elsewhere.  

 

10. Great Sports Teams.  From the Stanley Cup-winning Blues of the NHL to the beloved Cardinals of Major League Baseball, St. Louis has some of the best and most beloved pro sports teams in the country.

 

11. Numerous Fortune 500 Companies.  Of the ten Fortune 500 companies with headquarters in Missouri, nine of them are located in St. Louis!

 

12. A Very Generous City. While you may know much about St. Louis, one thing you probably don’t know is that it is consistently ranked among the most generous cities in the country in terms of charitable donations.  In addition, it also has a very high rate of volunteerism.

 

13. Family-Friendly Environment.  From its safe neighborhoods to numerous attractions such as the St. Louis Zoo and Gateway Arch National Park, St. Louis is known for having a family-friendly environment that attracts young families, aspiring entrepreneurs and young professionals, retirees and everyone in between.

 

14. A True Chess City.  Since investing in real estate sometimes feels like a chess match, you’ll be right at home when purchasing investment property in St. Louis.  Home to the World Chess Hall of Fame, it’s also been the home of several former men’s and women’s world chess champions.

 

15. Over 100 Parks.  Featuring lakes, picnic areas, playgrounds, and much more, St. Louis contains well over 100 beautiful parks to enjoy.

 

16. Great Festivals.  A city that’s home to many types of festivals, residents can enjoy festivals celebrating film, comedy, music and more.

 

St. Louis has a lot to offer residents, which means investors have a  lot to look forward to, as well. We’ve been gradually adding St. Louis turnkey rentals back into our offerings at MartelTurnkey. If you’d like to take a look at our turnkey rentals for sale, we’re sure you’ll find something a promising investment opportunity you won’t want to pass up!

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What is a Turnkey Rental?

If you’re new to real estate investing, the phrase turnkey rental may sound a little ambiguous. Turnkey might mean different things to different people. Everyone has their own understanding of how much work should be involved with a turnkey property. In real estate, a turnkey rental property is generally understood to be a rental property that’s ready to cash flow for the investor. A true turnkey rental has been renovated to a point where it’s inhabitable or already being rented out. Turnkey rentals technically should require only a modicum of effort by the landlord.

 

How a Turnkey Rental Works

 

A turnkey rental is a real estate investor’s dream. Instead of having the hassle of buying, fixing up, renting and managing a rental property, a turnkey rental practically takes care of itself. For investors who want to get into real estate but have neither the time nor the inclination to get their hands dirty working on a property or dealing with tenants, turnkey rentals are ideal. 

 

Typically, an investor will work with a company that sells turnkey rentals, like MartelTurnkey. It’s the company’s business to find lucrative turnkey rental properties in places like Memphis, Cleveland and St. Louis. The company will usually either supply a property management company to maintain and handle the tenant end of things, or the company might act as its own property management company. In the case of MartelTurnkey, we find and renovate properties, but we don’t manage the property. Instead, we have trusted property management companies that we work with who handle ongoing day in and day out management, paperwork, tenant concerns and so forth.

 

In most cases, the turnkey rental company will buy properties that need work, fix them up and then rent them out before selling them to investors. The real estate investors make money when the turnkey rental property cash flows, and the real estate company makes money on the sale. It’s a win-win proposition for all parties. 

 

Are All Turnkey Rental Companies the Same?

 

There’s no standard operating practice for turnkey rental properties, which is why we always advise real estate investors to be careful when choosing a turnkey rental company. Sometimes what’s advertised as being a turnkey rental property isn’t truly turnkey. If the investor is tasked with finding tenants, writing up contracts, doing repairs and managing the property, that’s not turnkey at all. Also, if the property isn’t fully renovated and ready to inhabit before the sale, that’s not a true turnkey rental property, either. 

 

At MartelTurnkey, all of the properties we sell are fully renovated before the investor buys it. In 99% of the cases, a tenant is already in place. In 100% of the cases, the turnkey rental is being managed by a property management company that is either actively seeking a tenant or managing an existing tenant. It’s worth mentioning here that if our investor wishes to use a different property management company, they are always welcome to do so. 

 

How a Turnkey Rental Property Generates Money For the Investor

 

A good turnkey rental property will provide income on a regular basis for the investor. This is called positive cash flow. Positive cash flow is profit for the investor. The cash flow is what is left after all the expenses related to the property are already paid. In other words, cash flow is what’s left after:

 

 – Mortgage

 – Insurance

 – Property tax

 – Property management fees

 

Many people wrongly think that investing in turnkey rentals isn’t profitable because they think they won’t make money after paying all those expenses. But when you see a positive cash flow number on our turnkey rental properties for sale, you can rest assured that is profit. The cash flow number we quote is a good estimate, but since insurance rates and mortgage terms vary, the actual cash flow number may be slightly higher or lower. 

 

Now, there will be expenses now and then associated with the turnkey rental property. This is to be expected with any property you own, including your primary residence. Sometimes things need to be replaced or fixed. These sporadic expenses come out of the profit each month. But with MartelTurnkey turnkey rental properties, you always get a positive cash flow quoted for every property, and for the most part, that’s what you can expect to receive on a monthly basis.  In addition, MartelTurnkey turnkey rental properties are nicely renovated, so our investors typically wouldn’t have any big ticket repairs to make for several years.

 

Why Are Turnkey Rentals Considered Passive Income?

 

Turnkey rentals are considered passive income because the investor doesn’t have to do much each month to get that income. Of course, there is a little bit of paperwork, insofar as each month money will be coming in, which needs to be recorded in the investor’s financial records. But the income is direct deposited, so it’s a simple matter of balancing the checkbook each month as usual. Then there may be a few emails from the property management company if necessary. All in all, there is about an hour or so of cumulative “work” for the investor over the course of a month. 

 

Are Turnkey Rentals Worth It?

 

To buy a turnkey rental from MartelTurnkey, you typically need about $20k, plus or minus, to put down on the purchase. This is commensurate with what you might put down on an inexpensive residential home for yourself. Once the turnkey rental is yours, you receive a profit each month from the difference between the rent paid and all the expenses going out. All during the time of ownership, the tenants are paying for the cost of owning that turnkey rental. Once the mortgage is paid, you have a turnkey rental property that you only paid the down payment on, plus you have all the monthly cash flow that went straight into your bank each month. All of this for what amounts to about an hour’s worth of paperwork each month. Any savvy investor would agree that turnkey rentals are worth it!

 

We’ve been selling turnkey rentals for five years now, and we’ve successfully expanded our business each year. This is due to the excellent reputation we’ve built by providing responsive, knowledgeable, personal and professional customer service. We’d be honored to count you as one of our investors. Please feel free to reach out if you’re ready to invest, and in the meantime you can peruse our turnkey rentals for sale. Our inventory is constantly changing, so please keep checking back or sign up for our VIP mailing list.

 

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Fannie Mae Announces Stricter Lending Limitations

Fannie Mae is making it harder for some investors to get approved for investment property and vacation home loans. While MartelTurnkey investors who work with our lenders don’t need to worry, it’s worth understanding what’s happening in the world of Fannie Mae-backed loans.  In a recent letter that lenders received from Fannie Mae, requirements for investment property loans will include lending standards tightened from their current levels. Furthermore, as of April 1, Fannie Mae announced it is also cutting back on the number of these types of mortgages that it will purchase. 

 

Reducing its Purchases

 

To begin with, Fannie Mae will be reducing the number of investment-backed loans it purchases to a level where these will comprise only seven percent of Fannie Mae’s overall portfolio. But perhaps more importantly, the company will have a particular focus on those lenders that have what is termed an “excessive delivery volume” of loans made for investment purposes, likely resulting in fewer conventional loans being granted to investors.

 

Tightening Underwriting Standards

 

While it’s certainly no time to panic, it’s also important to know Fannie Mae has also chosen to tighten its underwriting standards for investment property purchases.  Because of this, you may have more difficulty qualifying for a loan today than in the past, when you might have gotten approved with no problem whatsoever.  As a borrower, you will now be required to gain approval through the GSE Desktop Underwriter Program. Using this system, which will assess your eligibility and qualifications, means your lender will need for you to be given an Approve/Eligible recommendation and have the loan delivered to you as an official Desktop Underwriter (DU) loan to qualify.

 

Current Qualifications 

 

Since Fannie Mae plans an update shortly to reflect its new loan qualification guidelines, be aware that if you are planning an imminent purchase of a turnkey rental property, a minimum down payment of 20% and a 680 credit score will be necessary to qualify for a DU loan.

 

Why Changes are Being Made

 

As to why these changes are being made now, it comes down to the relationship between Fannie Mae and the U.S. Treasury.  With the new policies going into effect in early April, the Treasury Department wants to make sure lenders don’t take on unnecessary risks when granting such loans.  For example, should a loan fail to be eligible for purchase by GSE, the original lender will then have to hold the loan and thus take on far more risk than the Treasury Department prefers in the current economic climate.  Since both the federal government and the lenders themselves want to minimize risk, expect mortgage companies to be less lenient with investors regarding the approval of loans.

 

You Still Have Options

 

Before you decide there is no future for you as a real estate investor, remember that there are still numerous options available to you in regards to obtaining much-needed financing.  To begin with, conventional loans are still a very viable option, even with stricter requirements.  By ensuring your credit score is good and you have a sufficient down payment, you may still have no trouble getting these loans.  Also, you may be able to arrange a loan through a family member or friend, or even try your hand at crowdfunding.  Whatever the case may be, the money is still out there to be had for your real estate investments.

 

By remembering that other lending options are still available and doing all you can to meet the new Fannie Mae requirements, your real estate portfolio can continue to grow in the coming years. For more information or assistance getting financing for a loan, please contact us.