What Is a Turnkey Home?

Pros of buying a turnkey home

There are real advantages to buying a turnkey home, including:

• Your newly purchased home will be ready to move into from day one.
• There won’t be an urgent need for repairs.
• Renovations will be purely optional and subject to your own preferences.
• You’ll be able to settle in more quickly.
• You won’t have to worry about permits or code requirements that come with some home improvement projects.
• You won’t have to navigate a schedule of tradespeople or other workers coming in and out of your new home.
• There’s a lower risk of financial surprises after you’ve signed on the dotted line.

Cons of buying a turnkey home

All this being said, buying a move-in ready house isn’t for everyone. Downsides may include:

• A higher purchase price.
• Location options may be limited.
• Less opportunity for personalization of new features and functions.
• A feeling of “take it or leave it” when the idea of re-renovating a newly renovated home seems wasteful.
• Wondering if repairs were made correctly, or if the fresh paint and flooring may be disguising larger issues.

Medford cautions that he has “seen some pretty shoddy work over the years” when it comes to home upgrades, both in terms of quality of workmanship and aesthetic choice.

“Sometimes we’ll see — let’s just say ‘tacky’ — upgrades,” says Medford. “There are paint jobs, and then there are ‘paint jobs,’ you know?”

Should I buy a turnkey home?

You should definitely consider a turnkey home if convenience is your priority — and if you have the budget to compete at the top of the market.

“There are three tiers of homes in any market,” says Medford. “You’ve got the bottom tier, which are the total fixer-uppers. Then you’ve got the middle tier, which are usually aged homes that maybe haven’t been well-maintained over the years — they’re not fixers, but they’re what we’d call dead average, with no upgrades. And then you’ve got the top of the market, which are the gorgeous, renovated homes with a new kitchen, new bathrooms, and so on.”

Medford says he’s been watching the middle tier of homes slowly disappearing throughout recent years, citing buying trends that mean people either want a fixer-upper that they can fully redo themselves, or they want a turnkey home they can move right into.

“There just aren’t a lot of buyers for that middle segment of homes,” Medford explains. “Buyers don’t like buying ordinary, mediocre homes. Given the opportunity, they’re going to pay more for a fully upgraded turnkey home.”

What to look for in a turnkey home

Your agent will be able to help you discern a true turnkey home from one that has had little more than a thorough cleaning and fresh coat of paint, but there are a few key indicators you can look out for on your own.

9 Positive signs it’s a solid turnkey house

1. Plumbing and electrical systems are modern and updated to current standards.
2.  Appliances are new and energy efficient.
3. The foundation is free from cracks and other signs of damage.
4. The HVAC system is new or otherwise modern and well-maintained.
5. Fixtures and furnishings are upgraded.
6. The exterior of the home is visually appealing and free from damage.
7. The roof is in excellent condition.
8. Any storage spaces (like a basement or attic) are free from water stains and pest infestations.
9. Flooring is clean, level, and either new or properly restored.

9 Red flags in a so-called turnkey house

1. Fresh paint appears to be hiding decaying cabinets, cracked trim, or wall damage.
2. Moulding is damaged or unaligned.
3. Flooring is uneven or unmatched.
4. Countertops don’t line up.
5. Windows or doors don’t open and close properly.
6. Signs of water damage or mold are present.
7. The roof is missing shingles or is otherwise visually damaged.
8. There are stains on the ceiling.
9. Plumbing and/or electrical systems appear dated.

How can I protect against buying a faulty turnkey house?

Whether you’re looking for a turnkey home or not, it’s important to always have a thorough home inspection carried out before you commit to a property. Even if a house looks fantastic, and even if the seller can provide a stack of receipts for recent repairs and upgrades, a proper inspection can save untold amounts of money if the report reveals a not-so-obvious problem.

“A primary inspection in our area costs approximately $1,100,” says Medford. “I always tell my buyers to think of it as an insurance policy. You’re paying a small amount of money to make sure you don’t make a large mistake.”

In addition to the home inspection, you can further safeguard your buying process with:

• Additional specialized inspections, such as a pest, HVAC, roof, or mold inspection for added peace of mind.
• An appraisal contingency, which will give you an out if the home doesn’t appraise at or higher than your offered sales price.
• A home warranty — also known as home repair insurance — to offer assistance in the event of emergency expenses related to malfunctioning home systems or appliances.
• Advice from your real estate agent, who may have further insights about a particular neighborhood or common mishap with homes in your area.

Is a turnkey home actually worth it?

Turnkey homes are absolutely worth it when you want the ease and convenience of buying a home that is fully ready to move into as soon as you take the keys. You’ll need a larger budget in order to buy, but you’ll likely save money in the long run since you won’t have to worry about repairs or upgrades anytime soon.

But if you have big dreams of carrying out a total renovation on your own home, then a turnkey property probably isn’t for you. You’ll be paying more for a house that is already repaired and upgraded — so save the cash and buy a fixer-upper that’ll give you full flexibility to customize it to your heart’s content.

And remember, working with a great agent is your best bet for finding the perfect home for you — turnkey or not.

Header Image Source: (Étienne Beauregard-Riverin / Unsplash)