I would agree and disagree with rhm739. He is making assumptions about what seems to be a negative experience with the company he did business with and assumed all turnkey companies are the same way. Yes, there are some companies that will promise the world and make a huge profit. Single family investment properties is up and down. Through the 20 that I own, I have had my fair share of evictions over the 5 years since I have gotten started. I tell everyone, if you are going to buy just one property, then you would be best served calling a Portfolio Manager and investing in traditional products such as stocks, bonds, mutual funds, etc. Now if you can stomach the ups and downs of single family investment and you wish to build a portfolio of no less then 3 properties and truly understand the investment return is not only cash flow, but equity pay down through rents and massive tax deductions, then you have the right mind set. To many people think they can buy 10 properties and quit their job--not the case. I actually suggest paying down the debt (that is what I do). I also suggest having $1,500 in reserves for each property at all times. As for a profit margin, your turnkey provider should disclose this if asked. 5 - 10k is acceptable (keep in mind, a 10k profit could mean they secured a deal b/c of a certain relationship at a local bank that helped them secure a property not on the open market). I do know some make way more then that.
I still say working with someone who owns properties is key. You would not invest your money with a brokerage house is the guy handling your money was not invested in the financial markets, real estate should be no different. If not working with a turnkey company, I would work with a Property Manager. I would say most areas to invest in Memphis are terrible. The entitlement mentality here is unreal. Stick to Cordova and Bartlett and you will be fine. Don't get obesesed with buying at a discount. My most recent purchase for my own portfolio, after renovation, I am going to be at 90% LTV, but cash flow is going to be $550 a month.
My suggestion is if you work with a turnkey provider, order a independent home inspection and appraisal to make sure you are not paying over market.