EP 77: Doing Turnkeys the Right Way with Alexander Cruz, CR of Maryland
If turnkey rentals are done right they can offer investors great returns compared to the work they require. CR of Maryland knows exactly how to produce turnkey properties like these and today we had Alexander Cruz, a Partner at the firm, join us on the show. We kick things off with Alex chatting about his journey in real estate going from fix-n-flips to rentals and why he finally landed on turnkeys. He talks about the challenges of this, drilling down on the firm’s business plan and how they reached a stage where growth seemed less attractive than consolidation. Alexander shares a little about the different branches of the company, how the properties they buy slot into these, and the sterling example of making things work in your own market this presents. A major takeaway from today is an excellent breakdown Alexander gives about three of the biggest considerations one should make before going ahead with a turnkey property – numbers, product, and management. Here he paints an amazing picture of how CR of Maryland handles these three things which, taken together, show us their business plan is as good as the products they offer. Joining today’s conversation, listeners will also learn about Alexander’s ideal clients, how he presents the value of his products to them, and what he’s been doing to adjust his strategies since coronavirus. Tune in to get it all.
Key Points From This Episode:
Alexander’s journey from doing fix-n-flips to rentals and finally landing on turnkey rentals.
Challenges transitioning from fix-n-flip to rentals: Getting to know property management.
Refining rather than growing: deciding on turnkey after scaling the rental business.
The value of having an end goal broken into chunks to make a significant task much easier.
Other branches of CR of Maryland like wholesale, retail, fix-n-flip, and more.
Weekly measurables; what to do each week to meet the goal of selling 150 turnkeys a year.
How to adjust strategies to still meet the end goal if initial ones don’t work.
Alexander’s strategy for deciding if a property will become a turnkey, wholesale, or fix-n-flip.
Why people do not receive turnkeys well and how Alexander’s process might put their doubts to rest.
Making your market work for you rather than leaving: How Alexander’s strategies do this.
Important things that make a good a turnkey investment: Cash flow, product, and management.
How Alexander educates buyers about what returns they can expect from a turnkey.
The advantages of buying turnkeys for investors and Alexander’s ideal client.
Vacancy and renewal rates for Alexander which are strong due to his great product.
How Alexander has adjusted strategies after COVID around leasing, rent, sales, and more.
Where to go to get in touch with Alexander and learn more about CR Turnkeys online.
“For every department in the company, we have weekly measurables that all feed the end, long-term goal.” — Alexander Cruz [0:15:49]
“We strictly turnkey what we consider the easiest properties to rent which is where we have the most renters.” — Alexander Cruz [0:18:58]
“Our product is fully renovated and when I say fully renovated, we really go down to a gut. Our average renovation cost is over 75K per house.” — Alexander Cruz [0:24:58]
“We’re all about good cash flow but how do you get good cash flow? Well, you need to have a good product and you need to take care of your tenant.” — Alexander Cruz [0:26:14]
“The people that end up buying from us really are looking for passive income, they don’t want to deal with the work. A lot of times they live in California or New York or places that are substantially more expensive to invest. Whereas here, they can buy a house for $160 000 with 20% down, they’re in and they’re out, and they start getting a check the next month.” — Alexander Cruz [0:32:04]
Links Mentioned in Today’s Episode:
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