Sweat Equity

[Thoai Han]

Hi, I'm fairly new to BP. I wanted to know what are your views and perspectives on sweat equity if you know how to do all of the work yourself ? Would you hire a contractor to do so ?

[Bill Richard]

When getting started, if you know how to do the work, it's a great way to quickly build equity while learning the parts you're not great at yet. As you get better at the other parts of investing, letting others do what they do best while you do what you do best generally yields more to you.

At this stage in life, what I do best is put deals together. I do some repairs or remodeling when I feel like it but lately I leave most of that to others who are younger.

Here's an example of one way I do deals with those who want to make sweat equity:

 I will buy the place and provide all materials for repairs and remodeling and pay all carrying costs.

You do the labor for $10.00 per hour 

We do TEN places under this arrangement.

When done, I will buy the eleventh place and give it to you free and clear.   You do your own repairs on it.

All eleven places would be approximately the same general price. That eleventh place would be your bonus (sweat equity).