Turnkey Property

A turnkey rental property is one that’s already renovated, tenanted, and managed — you buy it and start collecting rent checks immediately without lifting a finger.

Turnkey providers handle everything: they find distressed properties, renovate them to rental standards, place tenants, and set up property management. You buy the finished product. It’s real estate investing on easy mode — at least in theory.

How Turnkey Investing Works

A typical transaction looks like this:

1. You browse a turnkey provider’s inventory (usually in landlord-friendly markets like Memphis, Indianapolis, Cleveland, or Birmingham)
2. Pick a property — it’s already renovated and often already rented
3. Close the purchase remotely
4. The provider’s property management company handles day-to-day operations
5. You receive monthly rent deposits minus management fees

Price ranges typically run $80,000-$200,000, with gross rents of $800-$1,600/month. Cash-on-cash returns are usually marketed at 8-12%, though the real numbers after all expenses often land closer to 5-8%.

The Appeal

Turnkey is designed for busy professionals who want rental income without the time commitment of finding deals, managing rehabs, screening tenants, and handling midnight maintenance calls. It’s also popular with out-of-state investors who want exposure to higher-yielding markets than their own.

A software engineer in San Francisco making $200,000/year doesn’t have time to rehab houses in Memphis. But they can buy a $120,000 turnkey rental that cash-flows $300/month with zero time investment beyond the initial purchase decision.

The Catch

You’re paying retail-plus. The turnkey company built their profit margin into the sale price. A property they bought for $60,000 and rehabbed for $25,000 sells to you for $120,000. That’s fine — they earned it. But it means your margins are thinner than if you’d done the work yourself.

Quality varies wildly between providers. Some deliver genuinely renovated homes with solid tenants. Others do cosmetic-only rehabs, skip foundation and plumbing issues, and place tenants who default within six months. Due diligence on the provider is more important than due diligence on any single property.

Red Flags

Unrealistic return projections (above 12% cash-on-cash), pressure to close quickly, refusing to share inspection reports, and providers who won’t let you use your own inspector. If a turnkey company discourages independent verification, walk away.

Run turnkey property numbers with our mortgage calculator and learn more about evaluating rental properties in our buying guide. More terms in the glossary.