Any help for a newbie wanting to start off a real estate adventure.

Green Bay, Wisconsin
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Any help for a newbie wanting to start off a real estate adventure.

Jeshua J Snyder
Member since 2022 · 2 posts · 1 vote

Hey all, My name is Jeshua, to get right down to it I am a 19 year old about to turn 20, ever since I was about 13-14 and I learned of the concept of rent and landlords I had wanted to be a landlord cause it sounded cool to me (i know i know it’s weird but it’s what i liked so just roll with it) but it always sounded like a pipe dream and something entirely unattainable to me because i always thought that I would simply never have the money to be able to afford one house let alone multiple. Then around 18 I stumbled across bigger pockets on YouTube and started watching their podcasts and realized that this dream of mine was far more realistic than I ever imagined. Now today my dream is to invest enough to be able to be financially free by the time i turn 30 so that I can first pay back my mother for supporting me all this time and then turn around and focus on being there for my future children full time. 

Thats the gist of why I'm here, now my question to all of you is this: is there a realistic way to jump straight into real estate investments in the Green Bay area without getting a regular job? From what I've seen on the YouTube channel my ideal scenario would likely be to get a JV partner where i find the deals I take care of everything involved in the work towards making a property profitable and someone else puts forward the downpayment or maybe even full cost of the house and I pay them back with a fair/generous return on the money they invested and take my own fair portion of it just to get my feet in the door.

I want to know the ins-and-outs of this whole process, the podcasts are informative but I never really feel like my questions are 100 percent answered there so I've come here to ask about it all. Are there really people out there willing to put forward an entire downpayment and just let me manage the entire process and split profits? If so how can I be sure that those who I am partnering with are legitimate and trustworthy? What failsafes should be ensured to protect both my time investment as well as their financial investments and make the partner feel more comfortable with the deal? What kind of split is fair if I find the property run the numbers rent it out and maintain it and he/she just puts forth the downpayment? What pitfalls should I be aware of when starting a deal of this nature? Should I even pursue JV deals or is there a better way to get started? Should I focus on getting a job instead and just try to get my investment properties on a bank loan out of pocket a few years down the line?

I have tons of questions as you can quite clearly see, but to summarize it all I am simply asking for any advice I can possibly get from those who hold experience in the field of investing, somewhat of a beginners guide to Joint Venture Deals I guess, one that just explains what to avoid and what to watch out for while on my path. And if it is even right for me to pursue. 

Please feel free to ask counter questions or just ask for more info, I absolutely love talking about all my ideas and goals and just the real estate topic in general. Thanks for any help in advance.


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Ben Firstenberg
Investor · Cleveland · Member since 2021 · 247 posts · 240 votes
3y

General advice I'd give to anyone just starting out. Get your first deal done. Do everything you can to make sure it won't burn you, but don't sweat it too much. Don't wait for a home run, don't try to time the market, don't worry if it's perfect. It's a monumental first step and everything will be different once you've closed your first deal. Everything. 

To your question about working with investors, it's definitely possible what you're asking for. It's hard to do at your age/experience. I don't think it's likely you'd find many people who would put up the ENTIRE down payment, just because then you don't have any "skin in the game." You could maybe get away with putting up $5-10k yourself if you explained that it's not much money but it's a significant % of your net worth. 

As far as the split, I would think about it as if you were trying to generate a certain % return for the investor and then determine what split it needs to be based on that. They could invest in the stock market at make 8-12% or they could invest in private equity and make 12-15% (if they have decent money). So maybe you need to be a 15-20% return to make it worth their while. That could mean giving them 50% of the deal, it could mean giving them 100% of the deal. 

Starting with JV is certainly atypical but I don't want to tell you it's not possible, since you're clearly very passionate about it. Just understand it will be challenging. Most people start with a house hack or a standard rental. Those are easier, but you have to have the money for it, which is tough.

A lot of people also get their start as a "deal finder" which is, in some ways, what you're describing. This could be an agent or a wholesaler, or working for an established investor and finding deals for them. 

Hope that helps. Best of luck!

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  • Ben Firstenberg
    Investor · Cleveland · Member since 2021 · 247 posts · 240 votes
    3y

    General advice I'd give to anyone just starting out. Get your first deal done. Do everything you can to make sure it won't burn you, but don't sweat it too much. Don't wait for a home run, don't try to time the market, don't worry if it's perfect. It's a monumental first step and everything will be different once you've closed your first deal. Everything. 

    To your question about working with investors, it's definitely possible what you're asking for. It's hard to do at your age/experience. I don't think it's likely you'd find many people who would put up the ENTIRE down payment, just because then you don't have any "skin in the game." You could maybe get away with putting up $5-10k yourself if you explained that it's not much money but it's a significant % of your net worth. 

    As far as the split, I would think about it as if you were trying to generate a certain % return for the investor and then determine what split it needs to be based on that. They could invest in the stock market at make 8-12% or they could invest in private equity and make 12-15% (if they have decent money). So maybe you need to be a 15-20% return to make it worth their while. That could mean giving them 50% of the deal, it could mean giving them 100% of the deal. 

    Starting with JV is certainly atypical but I don't want to tell you it's not possible, since you're clearly very passionate about it. Just understand it will be challenging. Most people start with a house hack or a standard rental. Those are easier, but you have to have the money for it, which is tough.

    A lot of people also get their start as a "deal finder" which is, in some ways, what you're describing. This could be an agent or a wholesaler, or working for an established investor and finding deals for them. 

    Hope that helps. Best of luck!

    3Reply
  • Fran Bourassa
    Property Manager · Green Bay, WI · Member since 2017 · 9 posts · 7 votes
    3y

    I'd agree with Ben - while possible, it's fairly unlikely that you'd find an investor that would be willing to put up a significant portion (or all of) the downpayment to work with someone that essentially has no experience.  After you have a proven track record, finding money is not exceptionally difficult if that's what you're looking to do.

    If you're serious about investing, if I were in your shoes and just getting started I'd focus on getting your foundation as solid as possible.  You will qualify for owner occupied financing (longer terms, lower rates, higher loan-to-value ratios) rarely - take advantage when you can.  From a long term standpoint, I'd focus on purchasing a multi unit (ideally four, at least three) unit building that you can move into and get a bit of experience under your belt.  Assuming you buy right, it will reduce your living expenses considerably and give you the opportunity to start saving for your next deal more aggressively.  

    Despite what many folks will tell you, cash is important as reserves, emergency funds or downpayment.  If you're really excited about the industry and are confident this is going to be your long term plan, get a job (or jobs) in areas that will either save you money in the future or allow you to sharpen your skills as an investor.  Installing floors, handyman type work, tiling, installing windows, etc.  Even if longer term you aren't planning on doing the work yourself, in the beginning it'll help you save some money while you earn it, all the while providing a great education that will give you an edge as an investor.

    Best of luck!

    1Reply
  • Jeshua J Snyder
    OP
    Member since 2022 · 2 posts · 1 vote
    3y
    Quote from @Fran Bourassa:

    I'd agree with Ben - while possible, it's fairly unlikely that you'd find an investor that would be willing to put up a significant portion (or all of) the downpayment to work with someone that essentially has no experience.  After you have a proven track record, finding money is not exceptionally difficult if that's what you're looking to do.

    If you're serious about investing, if I were in your shoes and just getting started I'd focus on getting your foundation as solid as possible.  You will qualify for owner occupied financing (longer terms, lower rates, higher loan-to-value ratios) rarely - take advantage when you can.  From a long term standpoint, I'd focus on purchasing a multi unit (ideally four, at least three) unit building that you can move into and get a bit of experience under your belt.  Assuming you buy right, it will reduce your living expenses considerably and give you the opportunity to start saving for your next deal more aggressively.  

    Despite what many folks will tell you, cash is important as reserves, emergency funds or downpayment.  If you're really excited about the industry and are confident this is going to be your long term plan, get a job (or jobs) in areas that will either save you money in the future or allow you to sharpen your skills as an investor.  Installing floors, handyman type work, tiling, installing windows, etc.  Even if longer term you aren't planning on doing the work yourself, in the beginning it'll help you save some money while you earn it, all the while providing a great education that will give you an edge as an investor.

    Best of luck!


    I do definitely intend to get a job in the market of working on houses, I actually had the same thought as you about six or seven months ago and love the idea of learning all there is to know about properly building and maintaining properties because a very very very end goal in all of this is to potentially even build investment properties of my own one day to rent out. Issue with that though is that due to personal issues in life I had held off on getting a drivers license and am only now going through the process and hold a permit currently, so I can't really legally get back and forth to different sites day to day. I am currently working on remedying that issue and it will be gone soon, but I'm eager to get started as soon as possible on this dream of mine so I was hoping to find a way to start early if at all possible, that's why I was looking into JV.

    I do understand what you both have said though and while it is a bit disheartening I do get why it’s the case and honestly I somewhat expected this type of response. Thank you both for your time. 


    If anyone does know of a way I could get started earlier than just securing a owner occupied loan I’d love to hear about it. Like I said before my goal is to get in the game as quickly as possible because I know the sooner I get in the better off I will be in the long term, so any advice towards that end is much appreciated if it’s even possible at all. I know it may not really be possible but I figure it can’t hurt to ask…

    0Reply
  • Costin I.
    Rental Property Investor · Round Rock, TX · Member since 2016 · 1k+ posts · 971 votes
    3y

    @Jeshua J Snyder - Here is my "starting up" collection:

    Read ideal-vs-desperate-investor (http://greeneincome.com/index.... Dave Ramsey book "The Total Money Makeover: Classic Edition: A Proven Plan for Financial Fitness." and complete the baby steps there.
    Read Scott Trench’s book “Set for Life.”
    Finish the school and get your degree - you'll need it later, especially if it's business management.
    Get a job first where you have W2 income. Save 50 percent after tax income. Find deals in your market. Buy at discounted prices. Rehab. Rent. Refinance. Repeat.
    Work slave job with W-2 documentation for 2 years to gain favor with banks. Freddy/Fannie conventional loans want to see those 2 years. Keep same job no matter how crappy. It's only a stepping stone to break free.
    While you are slaving, eat ramen, roommate up or live in trailer, avoid Starbucks and tuck every dollar you can squeeze out into a bank account. need 20% down and money for materials. so for 80K home (trashed), you will want 35K banked to get started, just a rough idea.
    Then, get pre-approved. Buy property. Buy another and another until you have enough equity to refinance one for large amount of cash. Take cash and start BRRRRR process (read up all you can on BRRRRR). Give boss notice. (sorry about all the school time you invested). Your free. Done.
    Find a mentor to help with the process.
    Doing an internship with someone that is serious about their business, and then making sure that you're just as serious about their business as they are, is an awesome way to gain invaluable experience and support for yourself in the long run.
    Intern with a flipper. Intern with a wholesaler. Intern with Rental Investor. Then decide what you want to do long term. You have a long journey ahead.
    Aggressively save money and buy a Multifamily 2-4 units with 3.5% FHA loan and house hack. Find a duplex/triplex that needs a little work, live in one unit rent out the rest. Raise the rents to market values and rehab to force equity and sell in 2 years to avoid capital gains. If you decide to keep the property you can refinance into a conventional loan and hopefully you have enough equity to eliminate the PMI/MIP. Then move out and repeat the process. Repeat. Do this four or five times and you'll never have to work again if you choose. [Beware = https://www.biggerpockets.com/renewsblog/house-hacking-drawbacks/]
    I would look for a 2-4 unit too house hack. You can get into these with 3.5% down for an owner occupied FHA loan. Great way to get started FHA makes sure its a cash flowing deal before they allow you to buy. And house hacking allows you to make a little off the property, and seriously subsidize your rent. And lastly, you gotta live like a college kid. Rent out rooms, go the cheap route. Having those cheap expenses will really catapult you forward financially!
    Income from RE investing is slow and boring (in a good way). The RE investing that makes fast money is not really “investing” - it’s a self-employed RE business. For example, flipping, deal finding, wholesaling, syndicating.
    Boosting your credit score is the no-brainer investment. Go on My Fico and learn the credit hacks. Do them!!!
    [Biggerpockets] is notorious for the no and no money down niche, but you really need to have a good financial runway prior to investing otherwise you will lose your bottom when it goes sideways.
    Read all the usual books. But to be honest with you, If you do not learn some construction skills, your progress will be a lot slower as contractors will be raking in the majority of your profits.
    Get a pro account on this site so you can access the PRO only blogs and avoid all the goofy stuff that can confuse you sometimes.
    Take NO advice from salesmen such as realtors/brokers. Not because they are wrong, but because they are salesmen.
    Take NO advice from anyone who does not own more real estate than you do. Why chance it.
    Just keep reading, saving, researching your target area. Know the rents! Know the values.
    Do all this and you'll be on a very good path. Just remember, there are no secrets and shortcuts in real estate investing, just slow and steady progress. You want fast, you are closer to speculating than investing and your risk skyrockets​.
    "Ignorance is bliss. Knowledge is power, but also a burden, leading to analysis paralysis. The cure to both - the 4 ions: education, action, progress(ion), not perfection".

    Learn to use BP to its whole potential:
    Subscribe to BP blog and podcasts and start reading posts and listening to their podcasts collection.
    Find and connect with other BP members that are in your area: http://www.biggerpockets.com/m...
    Set up keyword alerts to be notified of the topics that interest you: http://www.biggerpockets.com/a...
    Read Beginner’s Guide: Real-estate-investing (http://www.biggerpockets.com/real-estate-investing)
    + Actionable-steps-to- reach-investing-goals (https://www.biggerpockets.com/... can find a glossary of some acronyms here: https://www.biggerpockets.com/...

    You might also want to read: The Ultimate Beginner’s Guide - https://assets2.biggerpockets....
    ...actually the entire section on Guides - https://www.biggerpockets.com/...

    BP has a whole section dedicated to education and starting up - https://www.biggerpockets.com/...

    Get busy with the entire Education section on BP:
    property-types (https://www.biggerpockets.com/... (https://www.biggerpockets.com/... (https://www.biggerpockets.com/... (https://www.biggerpockets.com/... (https://www.biggerpockets.com/hubs/property-management) (including TENANTS MAINTENANCE)
    business-operations (https://www.biggerpockets.com/hubs/business-operations) (and the sub section on REAL ESTATE MARKETING TOOLS & TECHNOLOGY TAXES & ACCOUNTING LEGAL TEAM)

    One way or another you will pay your "real estate tuition" - either in time, effort or money. My suggestion - better in time and effort, and money (through the mistakes you going to make), than paying a guru.

    Between BP and books and all the other podcasts and blogs available for free, you shouldn't need any paid training - don't fall for that. Just find a good mentor to shadow, someone willing to impart from his/her experience, take them to lunch and make yourself useful to them, and they will teach you.

    Here some recent articles good for starters:
    - one to raise you up: 3-important-questions-starting-investing-real-estate https://www.biggerpockets.com/...
    - one to bring you back down to earth: dont-just-dabble-in-real-estate-investing https://www.biggerpockets.com/...
    - one in the middle: cheap-free-steps-today-pro https://www.biggerpockets.com/...
    - 10-lethal-mistakes-avoid-real-estate-investment https://www.biggerpockets.com/...
    - telltale-signs-youre-not-ready-to-invest https://www.biggerpockets.com/...
    - vital-importance-mentor https://www.biggerpockets.com/...
    - get-ready-to-invest https://www.biggerpockets.com/...
    - get-your-head-in-the-game https://royallegalsolutions.co...

    You might want to read and follow these threads:
    advice-to-your-20-year-old-self https://www.biggerpockets.com/...
    financial-advise-for-getting-started https://www.biggerpockets.com/...
    how-to-prepare-for-a-career-as-a-flipper https://www.biggerpockets.com/...
    new-to-wholesale-real-estate https://www.biggerpockets.com/...
    what-is-the-best-re-related-9-to-5-job https://www.biggerpockets.com/...

    Bonus for the weekend, my collection for starters (read the comments too, and then if you like the author, go check out what else they wrote):
    - stages-of-investing https://www.biggerpockets.com/...
    - newbies-learn-real-estate-investing https://www.biggerpockets.com/...
    - 5-ways-to-know-youre-not-ready-to-invest https://www.biggerpockets.com/...
    - ideal-vs-desperate-investor https://www.biggerpockets.com/...
    - how-much-to-offer-property https://www.biggerpockets.com/...
    - hazardous-attitudes-of-investors https://www.biggerpockets.com/...
    - 21-traits-scammy-real-estate-investment-guru https://www.biggerpockets.com/...
    - youre-not-cut-out-to-be-real-estate-investor https://www.biggerpockets.com/...
    - questions-new-investors-should-ask https://www.biggerpockets.com/...
    - real-estate-books-beginner-investors https://www.biggerpockets.com/...
    - what-separates-those-who-succeed-from-those-who-fail https://www.biggerpockets.com/...

    If that's not enough, ping me and I'll give you a whole collection of blogs and podcasts to follow.

    Bonus 2:
    1) Read at least one hour per day every single day.
    2) Remember the quote by Jim Rohn "You are the average of the five people that you spend the most time with."
    3) Check for toilet paper before sitting down.

    1Reply
  • Costin I.
    Rental Property Investor · Round Rock, TX · Member since 2016 · 1k+ posts · 971 votes
    3y

    @Jeshua J Snyder - if you need motivation and years of RE wisdom:

    MOTIVATION
    Know why you're doing everything you're doing. AKA Know your WHY.
    Good things may come to those who wait, but only the things left by those who hustle. -Abraham Lincoln (?)
    Some people want it to happen. Some wish it would happen. Others make it happen.- Michael Jordan
    "Things don't happen to you, they happen because of you."- Grant Cardone.
    The only way things will change for you is if YOU change !
    "Fortune Favors The Bold."

    YOUR NETWORTH IS YOUR NETWORK
    The richest people in the world look for and build networks. Everyone else looks for a job.
    You are the average of the 5 people you spend the most time with. If you want to elevate your life, improve on who you spend most of your time with.
    "If you are the smartest one in the room, you are in the wrong room."
    "People don't care what you think until they know how much you care."
    "50 percent of a deal is better than 100 percent of no deal."

    ACTION, PROGRESS, NOT PERFECTION
    "The best time to start was yesterday. The next best time is now."
    "You should have started many years earlier."
    To Avoid Criticism: Say Nothing, Do Nothing, Be Nothing + You miss 100% of the shots you never take.
    "Learn to forgive yourself for the things you didn't know before you knew them."
    Don’t wish it was easier ... wish you were better! + "If it was easy, everyone would do it."
    "On paper every strategy is easy, in the real world every strategy is hard"
    "What you know is your greatest wealth.. What you don't know is your greatest risk.. There is always risk, so learn to manage risk instead of avoiding it"
    “Action beats preparation, and over preparation is the Achilles heel to success”. + Luck is what happens when preparation meets opportunity.. + The harder you work the luckier you get!


    LONG TERM VISION & DELAYED GRATIFICATION
    I skate to where the puck is going to be, not where it has been. - Wayne Gretzky
    The day you plant the seed is not the day you get the fruit.
    Discipline is choosing between what you want now, and what you want most. - Abraham Lincoln
    Discipline equals freedom - Jocko Willink

    BUYING and SELLING
    When’s the best time to plant a tree? 25 years ago.. When’s the second best time? Today!
    Don't wait to buy real estate, buy real estate and wait.
    "Buy at the funeral, sell at the wedding" + When investing, pessimism is your friend, euphoria the enemy.. - Warren Buffett
    "Fearful when others are greedy and greedy when others are fearful" - Warren Buffet
    The Best time to buy real estate is NOW.. The Best Time to sell real estate is NEVER.
    "Never ever sell real estate. Ever. [but never say never, so...] Unless it's to buy better real estate"
    You make your money when you buy a deal.
    Know when to walk away - the numbers don't lie! + If it’s not a Heck Yeah, then it’s a No! (keeps me from jumping in on so-so deals/properties/etc)
    This holds especially true when starting out: The best deal you can do is the one you decide to walk away from.
    First three rules of real estate investing: location, location, location. + Location: the only thing about a house you can't change.
    If your offer has a bunch of zeroes in it, it will be shot down like the balloon it appears to be. Make it at least appear like you did a detailed analysis.
    It’s not the quantity that matters it’s the quality! And due diligence for the latest deal is more important than the deal itself!

    FAILURES / MISTAKES
    Failure to conduct proper background checks on tenants.
    Failure to properly vet contractors.
    Over-improving rentals and replacing things too soon (I like nice things – but my rentals don’t need them!).
    Two quickest ways to lose money in real estate:
    - Overpay for a crappy property
    - Overpay for an awesome property
    "A rising tide lifts all boats.. You can't tell who's lucky and who's good, unless you watch what happens when the tide is receding."

    BUSINESS
    Being an entrepreneur and starting up a business is like diving off a cliff and building an airplane on the way down.
    "Look at dollars, not dimes" --- in reference to spending money/paying fees to grow
    Identify what you do best, and hire the rest. [Do your best, forget the rest]
    "Learn to work on your business, not in your business"
    Don’t do business with people you can’t sue” .... different way of saying “don’t do business with friends and family”.
    "Sophisticated investors get 12% at least.. Average range of stable returns are 12-20%...once you fall below that, you reposition/sell/refi."
    "ABC..... Always Be Closing"
    “Speak softly, and carry a big portfolio!”

    After 30 Years of Real Estate Investing, THIS is What I Regret or Would Do Differently
    0. I Regret Not Starting My Real Estate Business Earlier
    0. I Regret Not Delegating Tasks Sooner
    0. I Regret Not Using Leverage in a Bigger Way
    1. Seek OPK (Other People’s Knowledge) sooner.
    2. Get serious about investing in real estate sooner.
    3. Let go of wrong assumptions.
    4. Learn more about the possibilities.
    5. Be wary of the naysayers.
    6. Surround myself with positive people, doing positive things with their lives, for the right reasons.
    7. Trust in God, trust in yourself, and trust in your partner more (your life and business partner).
    8. Create a strong team and delegate more.
    9. Review and reflect more often.

    Nothing is impossible, the word itself says "I'm possible"
    "Stop talking and just go make some offers.. There's saying and then there's doing. Luck takes action!"

    0Reply
  • Costin I.
    Rental Property Investor · Round Rock, TX · Member since 2016 · 1k+ posts · 971 votes
    3y

    @Jeshua J Snyder - and if you need partnership and JV advice:

    PARTNERSHIPS / PARTNERING
    How to Effectively Conduct Joint Venture Agreements as a Real Estate Investor
    https://www.biggerpockets.com/...
    +
    https://www.biggerpockets.com/...
    +
    https://www.biggerpockets.com/...
    +
    https://www.biggerpockets.com/...
    Partnerships and joint ventures are tricky. So, my first suggestion is...don't do it.
    +
    https://www.biggerpockets.com/...
    https://www.biggerpockets.com/...
    https://www.biggerpockets.com/...

    If you decide to proceed, I think you should have an LLC formed going in a limited partnership with your(s) partner(s) LLC. There are so many areas where things can go wrong with a simple partnership, and you want to be protected from an asset protection perspective. I can provide you with more info on that and give you a referral to a good attorney specializing in asset protection and partnership structuring.

    Before proceeding, I suggest to have all or most of following questions clarified:

    Joint Ventures – checklist / questionnaire

    Before you can start to set up the legal framework, there are various issues that need to be addressed. These can be summarised as follows:

    What are the objectives of the joint venture?
    - general trading principles
    - what will the business actually be doing

    Who puts what in?
    - cash
    - other assets
    - services
    - are any existing contracts of either to be taken over by the joint venture
    - who actually does / will do what

    Will any external funding be needed?
    - who will it be raised from
    - who will borrow it
    - who will guarantee it

    Who gets what out?
    - sharing of revenue profits or losses
    - sharing of capital gains or losses
    - is any payment to be made to either other than as share of profits, eg for ongoing services
    - will the participants be operating a ‘salary/dividend split’ – ie taking their month by month requirements by way of low salary, balance as dividends?

    What, otherwise, will be the policy in relation to dividends – to what extent is it intended to distribute / retain surplus profits?

    Who controls what?
    - responsibilities for day to day running, in all relevant areas of activity
    - tactical decision making (day to day)
    - strategic decision making (longer term policies)
    what things can only happen if both parties agree
    what will happen if you can't reach agreement on some major issue - ie deadlock

    What happens if either party 'wants out'?
    - on what kind of notice will this be permitted
    - does the other have 'first refusal' to take over the whole venture? - if so, on any favourable terms?

    To what extent will the parties be free to carry on other businesses
    - while the joint venture subsists
    - if one party pulls out

    Is it intended that spouses/partners should also be shareholders, to allow for tax advantages from a broader split of dividends?

    Is there a vision that any others will become shareholders (or be granted grant options to acquire shares) in the company in the future?
    - Who?
    - Staff?
    - Others?
    - On what terms?

    Participation in dividends?

    Voting rights?

    Are there any offshore angles:
    - Is there potential for overseas sales or operations?
    - Does anyone involved in the venture have any overseas connections?
    - Does anyone involved in the venture have any plans to live overseas in the future?

    Is there yet any written:
    - business plan?
    - marketing plan?
    - cashflow projection?

    Is there an ‘exit strategy’? If so, what is it – which of the following most closely hits the mark?
    - ‘lifestyle’ business – ie simply intended to be run by and to provide an ongoing source of work and income for the proprietors, no clear vision for the long term future?
    - possibility of future sale at some point?

    A core object of the venture is to create an asset with a view to sale or flotation in 5 years?

    Which aspects of the above do you feel most important at present? Which aspects concern you most? (NB each of you may have a different view here, the question is asked to help understand where each of you is coming from)

    If I'm your private investor, I'll want to know what your plans will be when things go horribly wrong. When repairs cost way more than you expected. When you can't find a decent tenant as quickly as you hoped. When the market tanks and prices retreat 25%. When you can't refinance as soon as you expected.
    I can guarantee you won't have a great Plan B for all of these disasters, but just the fact that you have considered them and have begun formulating some kind of plan will earn you their respect, and hopefully their business.

    0Reply
  • Aaron Gordy
    Real Estate Broker · Austin, TX · Member since 2012 · 1k+ posts · 1k+ votes
    3y

    @Jeshua J Snyder Watch Joe Pesci The Super to gain insight about landlording...lol. If I were you pay close attention to the words of wisdom from @Costin I. He is passing along solid info. 

    0Reply
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