The turnkey rental real estate investment is an investment that is made step by step under the guidance of a result-oriented expert. It is an "all-inclusive" service, where each step is managed for you, from the definition of the rental project, to its final realization.
The process allows you to take advantage of real estate by eliminating many constraints and limiting risks. With Ever Invest, you invest quietly and avoid procedures and hassles, thanks to a single contact person personally dedicated to your project.
What is a turnkey rental investment?
Making a turnkey rental investment means acquiring a property that is immediately ready to be rented out and that complies in every respect with your wishes as an investor.
It differs from a traditional real estate project in that it includes professional support with a whole range of expert services to help you define your project and ensure its profitability. These services and advices concern :
- the definition of your needs and your rental strategy;
- choice of property ;
- the forecast of renovation works to optimize this property;
- organization and supervision of the work;
- a complete technical support for large investments;
- the completion of the administrative and legal procedures related to the acquisition
- of the property;
- the choice of the tax package and advice on how to put together the financing file;
- the selection and choice of tenants.
Is it profitable to buy a turnkey property to rent it out?
L'rental investment Turnkey is a project managed from A to Z by a service provider with multidisciplinary teams, from the definition of the project to the entry of the tenant in the premises. It allows you to quickly become the owner of a profitable property, without having to make any effort.
This advantage is twofold, because it also allows you to invest in peace without having to endure the obstacle course of the real estate beginner: training on the Internet, running visits, doing the work yourself ... Because, if real estate attracts many candidates today, many quickly burn their wings for lack of knowledge in the field!
It requires, in fact, networks and fine technical skills, as well as knowledge of the field and mastery of legal and fiscal aspects.
It is particularly interesting, therefore, to turn to the turnkey rental investment for those who have neither the time nor the knowledge to launch themselves alone in the field, but who nevertheless intend to take advantage of this type of investment rather profitable!
Why use a turnkey investment company?
A structure such as Ever Invest, which is not a market place but offers a tailor-made service, is composed of a multidisciplinary team of specialists, all experts in their field: property hunter, interior designer, DPLG architect, works manager, etc. It can take care of any type of rental project, whatever its characteristics, in Paris, the Ile-de-France, Lille, Troyes and Reims.
Buyer's side
Where does its added value lie, compared to that of a traditional real estate agency?
A turnkey rental investment provider differs from them by the fact that it is turned towards the buyer and not, as it is the case of the agencies, towards the seller.
He defends the interests of his client during the purchase transaction. He also provides his clients with a wide range of advice to help them better define their investment in relation to their financial and asset management objectives. He defines his investor profile, so as to arrive at a rental strategy which will then define the expected level of profitability, correlated to the type of property to be found.
Your investor profile
Even if any real estate investment always aims at enriching the investor, different motivations are hidden behind this goal and the implementation of an expertise: the defiscalisation of its incomes, the constitution of an inheritance to be transmitted, the investment via a Holdingthe creation of additional income (in particular to prepare one's retirement), or even, why not, the ambition to become an annuitant thanks to real estate!
Each of these perspectives determines investor profiles that do not require the same type of investment:
Are you going to invest in new or old buildings?
What type of tax package will you consider?
Different possibilities are emerging, with the fundamental criterion of profitability.
What is the rental return for a turnkey rental investment?
The goal of any rental investment is to be profitable, i.e. to ensure that the person making the investment will make money. And the assembly of a turnkey rental investment owes its effectiveness precisely to the fact that it is based from the start on calculations of return.
The expected level of profitability serves as a basic indicator of the type of property to be found, especially since one of its major variables is the purchase price.
The advice of an expert saves a lot of time at this stage, because he already knows which type of property to choose, based on his knowledge of the rental market.
A turnkey rental investment is therefore determined at the base, by a rate of return to be reached, even before aiming at the type of property to be purchased. We know that the majority of rental investments are nowadays made far from the investor's place of residence, this type of investment often having little to do with the purchase of a principal residence.
Yield calculations
The different yield calculations are used to select the property at the outset, i.e. to retain only the interesting options among several choices, and then to settle on the best alternative.
The experts start for that on calculations of gross profitability, which are a first approach, to finish by the calculation of the net profitability, constituted by the ratio of the purchase price of a good (increased by the expenses of acquisition), on its receipts, that is to say the expected rents (from which one deducts all the expenses of exploitation)
Real estate cash flow
Then, they complete this calculation with the cash flow calculation, a figure that is very popular with investors, which results from the calculation of the cash remaining in the investor's pocket each month, once all the expenses have been deducted (including taxes).
This indicator is now used as a reference for profitable real estate investment and it is one of the vocations of the turnkey rental investment, to set up projects generating very high cash flows.
The leverage effect
These cash flows activate, in effect, the leverage effect of creditThis allows for the multiplication of acquisitions and the expansion of a property assets. Everything is based on a simple principle: the banks pay, the rents pay back.
A turnkey rental real estate investment saves time because it allows you to target profitable projects based on figures from the start.
From experience, your consultant knows the characteristics of the property to be found (location, size, site), according to your objectives as an investor.
Define the rental strategy of the rental investment
Very often, the new real estate investor focuses on the property to be acquired, without really knowing the parameters that make this property a truly profitable investment for him. To be more precise, the property represents only the apparent face of an investment, the rental strategy, i.e. the way it will be exploited, being the hidden face.
However, a turnkey rental investment is accompanied by a tailor-made advice.
Your service provider will determine which type of rental is the most profitable for you, i.e. which niche of the rental market to turn to in order to optimize your famous cash flow. Some of them, such as seasonal rentals or investment properties, generate among the highest returns: you still need to know them!
What is the average rate of return on a turnkey investment?
For reference, keep in mind that the average rate of return on a rental investment is around 4-5%, but that it can exceed 10% in seasonal rentals, and already exceeds 7% in co-rentingor with a building of report or a coliving whose project will have been well set up. The rental strategy also has a direct influence on the work, as the same surface area can be redeveloped to be used more profitably.
Let us quote, for example, the example of a large surface to be transformed into several independent residences in order to benefit from the beautiful returns of the colocation.
Have a strategy in mind
A turnkey rental investment is therefore an investment where the rental strategy is an integral part of the project from the start. It is the subject of specific reflection in order to optimize the attractiveness of the property. The services and advice of professionals, who are constantly on the lookout for new developments in the sector, are therefore crucial at this stage and help avoid mistakes.
Please note
Did you know that? Seasonal rental, such as Airbnb, which consists of renting by the night, and therefore applying rates close to those of the hotel industry, is particularly profitable. But beware, the current health crisis makes it extremely risky from the point of view of rental vacancy! Always ask for professional advice before making certain decisions with serious consequences.
The choice of the property
Of course, investors do not have to make any research visits, which is a big advantage when you think of the incessant travel involved in the visits and sometimes the fatigue and discouragement that follow.
Visits require, in fact, knowledge that escapes the novice investor. You therefore save a lot of time and energy because your service provider has two advantages: he knows where to look for the property and can quickly assess its quality.
The off-market
Thanks to his access to the "hidden rental market", with his professional network, he can unearth the best offers, even before other buyers have visited the properties.
He does not reason as a neophyte, at "love at first sight", but focuses on objective criteria in his choice, in particular the location, the proximity to shops, transport and public facilities.
He also knows the cities and neighborhoods where to invest, while making sure that the rental market on the spot is not too strong, so as to be able to pull the level of rents upwards.
Here are the different types of turnkey investments offered:
The turnkey studio
- Advantages: low entry ticket and liquidity
- Disadvantages: lower profitability and cash flow
The turnkey collocation
- Advantages: moderate entry ticket and high profitability
- Disadvantages: higher risk of turnover
The turnkey investment property
- Advantages: high profitability and control of the co-ownership
- Disadvantages: administrative and urban planning constraints to master
Turnkey coliving
- Advantages: very high profitability and investment in the future
- Disadvantages: less liquid due to its configuration
The steps of a turnkey rental project
The turnkey rental investment is not limited to a simple real estate investment, but focuses on being profitable, while respecting the desires and projects of an investor.
The client then proceeds hand in hand with his advisor throughout a process that is divided into several stages.
The definition of the project
You have a budget, desires, but above all financial and patrimonial objectives: your service provider will help you to clarify all this around a concrete project. You will define with him the type of property on which you wish to position yourself while benefiting from all the useful advices, in terms of taxation in particular, to land on a profitable project.
Please note
Not all providers offer the same service at this stage. Some simply respond to the client's request by searching a database, while others, such as Ever Invest, prefer a "tailor-made" service, with a dedicated advisor for each client. others, such as Ever Invest, prefer the "tailor-made" approach, with an advisor dedicated to each client's request. The advisory services relating to the investor's profile, the desired profitability, etc., are thus fully personalized, as is then the search for the property.
The negotiation
When it comes to the purchase price of the property, your service provider will give you a decisive boost, because he has all the basics of negotiation. He knows the market prices to make an offer, and also knows, if necessary, how to lower a price.
Several procedures exist for this, which are a matter for connoisseurs (identifying properties that have been on the market for too long, playing on defects, etc.). A professional also knows how to "seize" the offer at the right time to avoid having it "blown away" by the competition!
Certain types of high-yield properties, particularly investment properties, are accompanied by both a negotiation effort and very heavy technical constraints on the purchase.
Please note
For this reason, Ever Invest is a start-up that assists its clients in this type of complex problem, thanks to a specially dedicated department.
From the very first visit, its specialists will identify the technical defects of a building and scrutinize the various documents (diagnoses, maintenance logs They are thus able to make the right diagnosis of the property and, if the deal is profitable, plan the appropriate restoration work.
The restoration of the property
This step is very important, why? Because many profitable properties are located in old buildings, which require restoration work at the time of purchase. These works are fully justified, because they improve the property and make it more valuable.
With a turnkey rental property investment, all this is planned and included in the service. All the work to be done, such as the planning of the building sites and their realization, are quantified at the beginning. We also determine at this stage the decoration, because certain rules are imposed for a decoration at the same time current and design (but not too personalized so that the tenants can project themselves there).
Financing a turnkey rental property investment
The advantage of making a turnkey rental property investment is that everything is calculated for you. No unpleasant surprises upon arrival, and less risk of being refused a mortgage because your banker finds that your resources are too limited to invest.
Don't forget, in fact, that the debt ratio is always set at a maximum of 35% of your resources by the banks, and that it is not advisable to embark on real estate without precautionary savings.
Administrative acts
If there are more and more fans of turnkey rental property investment, it is also because it allows you to invest remotely, without having anything to manage, or even needing to move. The expatriateswho often invest in their country of origin in order to prepare their retirement, can plan their investments entirely from their country of residence, sometimes even without returning to France.
Thanks to electronic signatures, administrative procedures such as sales contracts and notary's offices no longer require physical documents. And the trend is still growing under the effect of the confinements and the health crisis.
Renting out
A turnkey rental investment is finalized with the installation of the first tenants in the premises. For that still, the investor profits from a service all included, since his provider makes for him the work of selection of the tenants.
Delegating a turnkey rental property investment limits the risks
There are many parameters to master in order to make a successful rental investment. Certain types of investment, such as investment property or any investment involving work, cannot do without advice and support.
By calling on Ever Invest, you short-circuit the risks from the start, the investment being marked out from start to finish by professionals.
Buying on impulse is also to be avoided in rental property, which is above all a matter of yield and pragmatism.
Beware also of risky tax exemption operations, because if many people invest to reduce their taxes, this should not be done at the expense of the quality of the investment. Otherwise, today's tax advantages may become a burden later on, as some investments in new Pinel properties tend to demonstrate today.
Support from A to Z
A rental investment project well set up from A to Z is a project that has a long-term strategy: patrimonial strategy or profitability strategy with cash flow. The Ever Invest teams are at your disposal to help you set up your project!
The advantages of turnkey rental investment
The advantages of turnkey rental investment with Ever Invest | |
Definition of the investment strategy |  |
Hunting of the personalized good | |
Planning and Development Strategy | |
Work follow-up | |
Furniture management | |
Renting out | |
Premium service | On average, our Investment Managers work with only 5 clients (compared to several dozen for some other start-ups). |
Experience | Experience is key in our field. The average age at Ever Invest is 35 years. |
Fees | Our hunting fees are 5% before tax and go up to 7% for a global mission. They can be fully deductible from your taxes. |
Human intelligence | At Ever Invest, we do not raise funds. |
