Exposed: RoofStock’s TurnKey Real Estate Investing

As highly requested, here are my thoughts on Roofstock’s Turnkey Real Estate Investing, and some of the advantages and disadvantages through investing with them – enjoy! Add me on Snapchat/Instagram: GPStephan

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For those that aren’t aware, RoofStock is a pretty cool concept. It’s a website that analyzes single family properties positioned as rentals. The advantage for buyers is that they can access homes with renters already in them, allowing them to buy a property with immediate, predictable cashflow. The advantage to the seller is that you can sell your property with the tenant already living in the house, thereby not losing out on any rental income during the selling process.

From the BUYER perspective of things, I have to say, I really, really, like the layout a lot. The ability to go online and play with the numbers and instantly see how they affect your cash flow is awesome. Roofstock also has a “30-day money back guarantee,” where Roofstock will buy back the property if you’re unsatisfied with the purchase.

Even though the process seems very streamlined, one of the biggest flaws I see if that it doesn’t appear like you can do your own inspections on the property. They have their own certification process and they will provide you with their own inspection reports and due diligence for you to review.

My second concern is that these properties don’t seem like they’re really in prime locations. Now prime location is certainly subjective depending on who’s looking at it, but from the way I see it, these are mainly cash flowing properties.

The third downside I see with this is that there’s not really any room for improvement. I understand that this isn’t Roofstock’s target audience, and they’re going after the laid back investor who just buys and sits back…nothing wrong with that…but a buyer could get MUCH more value by buying a property, remodeling it, and renting it out themselves for a higher price than buying something turn key.

Some seller issues I could see:

Not having a sign out front of your house. Having a sign out front makes people aware that there’s a home being sold. The more exposure a home gets, the better.

Second downside…the property isn’t listed on the MLS. Again, exposure gets homes to sell at higher prices. And by not listing on the MLS, they’re excluding a LOT of buyers from even seeing that home to begin with.

Third downside, because you’re selling the home occupied with a tenant, your buyer pool is very, very small. You’re immediately excluding all the families that might want to buy that home just to live in, themselves.

So given that, honestly, I don’t really see it being a bad service. I’m pretty neutral about it. For buyers, it would be nice to do your own inspections and due diligence…and also to get the best bang for the buck, it’s definitely worth it to do the work yourself…but I get that not everyone has the time or interest in doing that, and if they’re okay paying a premium for turnkey properties, nothing wrong with that. I’m not a fan of the areas they have listed, they all seem too remote for me…which carries its own risk in desirability and the ability to re-rent the home, but that’s all subjective. It’s really, really important for a buyer to do their research into how easy the home will be to re-rent during a vacancy, and how well the areas are poised to grow…if any.

For sellers, I suppose if you want an easy, hassle free, streamlined process for sale…it seems decent. But, I also believe that you’re leaving money on the table by ONLY appealing to investors, NOT listing on the MLS, and NOT allowing for private showings. But like I said…overall, it seems decent. I like their guarantee. I like their calculators. Would I personally use it? I really doubt it. Do I think it’s a decent place to start? It can be.

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19 thoughts on “Exposed: RoofStock’s TurnKey Real Estate Investing”

  1. Interested in Forex, Stock Market, If “YES”, then “HEADWAYANALYSIS PHOENIX 5.0 CLOUD" is for you! Here you have International traders and programmer whose main goal is to create a system that works in all market conditions and at all brokers, especially ECN and STP. If you would like to know more do more reach on Google. Email: Frankpeterhills@gmail com

  2. I honestly see a lot of potential here! I agree that locations and properties are not the greatest, but they are still fairly new. In 5-10 years if they keep expanding, and become more popular we could start to see thousands of great, and new properties listed on Roofstock! I do agree, that the signs “selling with Roofstock” would be a GREAT opportunity for them.

  3. Recently found your channel and found it interesting. Only downside I found with this video and it's not you but YouTube was the placement of the commercials (5 of them) and where after two, the placement was so off that you noticed a list of some content (gap in what you were saying). Otherwise, good food for thought.

  4. Graham, can you do a video on what is considered good rent? Specifically the 1% rule? I read on Bigger Pockets that you should shoot for 1% rent.

    I’m north of NYC, shopping for an income property. Doing the math, I think I can charge fair rent and be cash flow positive, but no where near 1% of the property cost. What is considered a “good” deal?

  5. I am just about to start with my first rental property in CA and you say buy it under an LLC. It's 800 bucks a year here! How do you counter this? Do you just deal with it? Hard to find cali specific llc advice.

  6. Would you be able to sell the house and be the tenant? Trying to liquidate the house but have a place to live for the time being.

  7. Graham, don't think your time isn't appreciated. It is. Your vids truly are one of the few I mean to not miss each posting. Keep it up for all those still following in your tracks!

  8. To be completely honest with you, I had no idea what this video was about, so when that first drumroll went off, it was actually a surprise to me to find out the roof thingy. I just clicked the video as soon as I saw “Gra-“ in my recommendation

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