Extraordinary Turnkey Rental Property Investments in Birmingham, Alabama [EPISODE #252]
The Big Idea
There's nothing sexy about Birmingham, Alabama... unless very high cash flow from very inexpensive properties is sexy. In that case... Birmingham is smoking hot!
Points To Ponder
- Turnkey rental properties are homes you buy as rental properties, but there's already a tenant and property manager in place to make the whole investment "hands-off" for you
- Birmingham, Alabama is a strong alternative to consider. Cash flow ROI is very strong.
- Example: 1,000 SF home, built in 1920's but fully renovated, 3 bedrooms, 1
bath, kitchen, livingroom, etc. Fully renovated: $55,000
- Net ROI easily in 8-13% range
- To learn more about this market, call the SDI 2-minute free recorded info line at (773) TURNKEY
- Episode #252 of Self Directed Investor Talk available here
- Free Webinar that shows how many SDI Talk listeners are receiving very large credit lines at 0% interest for their real estate deals or businesses. Check it out Free Webinar.
Time to do some ACTUAL INVESTING, people! Today, we look into one of my favorite markets. I’ll tell you why I like it, what the numbers look like… and maybe, just maybe… I’ll even tell you how you can jump in. I’m Bryan Ellis. This is Episode #252 of Self Directed Investor Talk.
Hello, Self Directed Investor Nation! Welcome to the podcast of record for savvy, self-directed investors like you where every single weekday, it’s my pleasure to turn you on to the finest alternative investment opportunities known to man as together, we DECLARE INDEPENDENCE FROM WALL STREET!
We’ve focused a lot on tactical and policy stuff in recent days, and there will be more of that in the future. But for now, let’s focus squarely on one of my favorite topics: MAKING MONEY!
Now each day at this time, I tell you about my friends over at Fund & Grow, who sponsor this show. I’m going to do that again now, but today this will have EXTRAORDINARILY HIGH relevance, as you’ll see in just a couple minutes. If you need funding for a real estate deal, a business project or anything else, let me tell you: Nothing beats an interest rate of ZERO. To learn how you can acquire from $50,000 to $250,000 of zero-interest cash credit, just visit SDITalk.com/credit. That's SDITalk.com/credit to learn how to get $50,000 to $250,000 of zero-interest cash credit. Visit SDITalk.com/credit now.
Ok. Let’s revisit one of my very favorite topics – and I know yours too – Turnkey Rental Properties, and specifically, a great market for owning them.
For those of you only recently joining the vast and ever-expanding audience that we lovingly call SDI Nation, a turnkey rental property is a house you buy to rent out, only it’s totally hands off. At the time you buy it, it’s already been renovated… it’s already got a paying tenant… and it’s already got a professional property manager in charge of it. It’s a stand-alone cash-producing asset… the “easy button” for real estate investing, in a manner of speaking.
So, the market I’m recommending? There are several good markets across the country for these things, and I’d be fine with recommending several of them – and in fact, frequently do. But the one we’re focusing on today is none other than the sleepy mid-sized town of Birmingham, Alabama.
My friends… there’s nothing sexy about Birmingham, Alabama. It’s not on any lists of super-hot real estate markets. You’re not going to brag to your friends about the gorgeous house you just bought in Birmingham. The second most notable thing coming out of Alabama is some seriously high-quality college football.
But college football is definitely only the SECOND most notable thing. Far and away, the MOST notable thing coming out of Birmingham is CASH FLOW. Yes, yes, yes! Cold, hard cash flow.
Here’s a fine example of what I mean. It’s “fine” in that it’s impressive. But as impressive as it is, it’s very common.
I’ll pick one particular property in Birmingham that is now available to give you a taste of it.
This property is about 1,000 square feet, and it’s very old – built in the 1920’s – but is freshly renovated and in really solid condition. It’s 3 bedrooms, 1 bath, kitchen, living room… very typical fare for rental properties in terms of specs.
This house… freshly renovated… is priced at $55,000.
Now you folks out west and in the northeast who think of $55,000 as a small portion of a down payment rather than the purchase price for a whole house… just calm down! This is, in fact, a real house! <g>
But the house is only part of what you get for that price. You also get a signed lease with a tenant who is already paying $750 per month. Yep… that’s right… you’re looking at $9,000 per year of gross income from an investment of only $55,000.
But you can’t pay the bills with gross income – so I can tell you this – depending on how conservative you are with things like allowing for vacancies and maintenance costs, your NET ROI on this will land somewhere in the 8-13% per year range… and that’s JUST from cash flow. Any tax benefits or property value increases you receive aren’t even considered.
And frankly… you have to be REALLY conservative in your projections before your net would drop as low as 8%. I mean REALLY conservative. The normal net is usually around the 10-12% range.
So… really strong cash flow.
But still, that’s not all you get with that purchase price. You also get a relationship with a property manager that’s ALREADY in place. As in, the property manager was the one who found the tenant, signed the lease, and managing the relationship. That’s already in place, 100%, at the time you buy the house to begin with.
Pretty attractive stuff, huh? Truth is, I’ve not told you the best part about this scenario. No, Birmingham is NOT a sexy location. But there are some reasons it’s a fundamentally EXCELLENT market, and I’ll tell you all about that in the NEXT EPISODE of this show.
Hey… remember I mentioned the stuff to you a bit ago about how the who “get ZERO Interest financing” thing I mentioned – SDITalk.com/credit – was particularly relevant today, even more than normal? Well… I didn’t do this on purpose but I am out of time today, so also in tomorrow’s show, I’ll tell you how to combine THAT particular extraordinary opportunity with this whole high-yield turnkey rental property concept to create some results that are… frankly… ASTOUNDING.
All that on the very next episode of Self Directed Investor Talk, the link to which will be on posted on today’s show notes page at SDITalk.com/252 shortly.
But in the mean time… I do have a few properties in Birmingham that match the specs I just described to you. You’ll learn more about why I think that market is so great tomorrow, but if you’re already intrigued – and you want to get a shot at owning some of these great little assets before we sell out of them again – just call my free 2-minute recorded info line at 773-TURNKEY to learn more. There’s just some basic info there that will help make sure I don’t waste your time and you don’t waste my time. Fair? Yes indeed! Again, that number is 773-TURNKEY, 773-TURNKEY for my free 2-minute recorded info line about turnkey rental property investing.
My friends… invest wisely today, and live well forever!
Bryan Ellis is host of Self Directed Investor Talk, America's #1 radio show and podcast for affluent self-directed investors. He's also an expert in self-directed IRA's, solo 401k's and turnkey rental property investing... at least, that's what his wife tells him 🙂 He's a contributor to well-respected publications like TheStreet.com, Entrepreneur and ThinkRealty. Bryan lives in metro Atlanta, Georgia with Carole Ellis - his wife, business partner and best friend - and his 4 children ranging in age from 2 to 19.