Help me structure a fair deal

[Jacob A.]

Trying to figure out the best way to go about this…

I have a property under contract. It’s a dilapidated house that’s too far gone. It’s 100% a tear down. I’m thinking of partnering with my uncle who’s a GC.

Should I buy the lot by myself, and split the building costs? Should I ask him to front the building costs until we close? Should we buy the lot together and split everything 50/50? This 50/50 scenario does sound like it’s the cleanest way to do it and I’m not opposed to it. I just haven’t thought about it until now. Thinking about holding costs, and accounting at the end of the year, etc. i certainly don’t want to be in a position where I split everything down the middle but get stuck holding the bag on taxes.

I’m liquid enough to handle it all on my own. I’m just not sure I want to. I’d like to present it as fair as possible, but at the same time this is a property that I prospected for over the course of 6 years. (For once my follow-up game was on point.)

I’ve done a few flips before with partners but we’ve bought them together and sold them together. I’ve never done a new build and never really had a scenario where I was in a position to buy it on my own.

Just looking for some advice/suggestions on best way to go about this.

[Simon W.]

@Jacob A. You can purchase it and then just hire your uncle to do the reno work. Did you talk to your uncle about this property and possible structure? He might not even want to partner up.

It would be easier to do the accounting if it isn't a partnership. Your uncle would simply be a vendor.