Property Manager
If the turnkey operator
arranges for property
management, or is providing
it themselves, it is important
to interview the manager.
The “Property Management
Interview” questionnaire in
Attachment #1 can be used.
It can also be used to hire a
Enhanced Diligence by investors involves obtaining copies of all new manager in the event
permits from the turnkey operator, then comparing them to the the present manager needs
Building Department file for the property. Most departments have to be replaced. Enhanced
this online now or, if not, permits can be requested by mail and Diligence also includes
enclosing the required fee. This is public information. obtaining and checking
licenses, professional
If any of this does not go smoothly, or check out, take a hike.
certifications, and references
for the property manager.
Obtaining Inspections
Three references is probably
enough.
In principle, the author recommends obtaining a “property
inspection” report by a licensed contractor even if the turnkey
operator discourages the idea. In fact, that might be even more
Tenant Estoppel
Certificate
reason to order one! The cost is usually $450 to $600, depending
upon the size and complexity of the property being inspected. If the property comes with a
Look especially for two kinds of findings: 1) building code tenant, or several, rents will
violations and, 2) health and safety hazards found. An example be prorated, and security
would be exposed electrical wiring. It is important to negotiate deposits will be transferred in
corrections to all of these and, if not satisfied, again, take a hike. escrow. Just the same, the
investor should insist that
Now, some cities do inspections before rehab properties can be each tenant fill out and sign
transferred. The investor needs to decide whether this is (all tenants) the Estoppel
sufficient. One of the author’s consulting clients purchased a Certificate in Attachment #2.
turnkey house where four city inspections were to be done. So, This avoids any possible
on a $62,000 house, the client felt he saved $450. It’s a business disputes with the new owner
decision. over terms of the tenancy.
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