Partners...?

[Account Closed]

Not sure which forum this should have been posted in but since I'm just starting out myself it seemed like a fit. 

Is there anybody who has, successfully or unsuccessfully, partnered with another person for buy and hold real estate investment? Not talking about spouses either. I have a friend who's offered to do the renovation work if I buy the property but I'm thinking maybe I should do this 100% on my own. If I did take on a partner of course I would get absolutely everything in writing first. 

[John Stovall]

I sort of laughed at this post because my partner and I constantly refine the way we work together. When we signed the partnership agreement, I joke that he only has 3 tasks for me: and the third one is "do everything else not mentioned in this agreement."

I would say the most important part of our partnership is that we have veto power over the other. We've gone from 2 houses that are split into 3 apartments each to owning 20+ residential homes and some commercial property. I do the operations for all residential, and he handles the commercial property. (Although I still control the workers, etc, on those.) I probably work double or triple the hours he does. We both have other jobs.

But what he did that was smart is he accepted all the duties that I hate: Bookkeeping, dealing with the city, organizing financing, and when I have a problem, he comes through. We are both very happy with our arrangement, and to this day, have never had an argument.

Yesterday, I told him I wanted to buy another property. I REALLY wanted it, and although he didn't veto me, I could tell he wanted to take a break from acquiring any new properties for a while. We had a counter that I would have accepted, but I called our agent today to not accept the counter and pull out of the deal. Why? Sometimes you just need to cede to your partner's viewpoint and not "win" all the battles.

So my advice is not to worry about the duties listed in the agreement, although they are important, and find a partner who will support you -- and know when to support them back. I have loved what I do, but I found my partner worrying about our growth. We've been lucky enough that everything we've acquired has been successful -- far more successful than what we've planned -- but it might be a good time to spend a couple of more days at the pool instead of continuing the growth. Instead of using every dollar acquiring new property, I am now working to make his job easier by building up a larger reserve and paying off more of the properties we now own. 

I know that's what he wants to happen for the next year or so, and as I said, sometimes you really do need to make the partnership stronger by supporting your partner.