Advice about potential partner for house flip

[Tonya Sanders]

My husband and I live in California currently but are planning to move to Tulsa, OK over the next year. Given the allure of the cheaper housing in Tulsa we started looking for a property that we could flip. Living in California, that obviously presents a bit of a challenge. In the process of networking and looking at possible property deals, we connected with a husband and wife who live in Tulsa and often flip properties. She is a Realtor, and he is a contractor. We discussed the possibility of working together to flip a house remotely. We would provide the capital to buy a property and renovate the property. They would help us find a good property, evaluate it's potential, oversee the renovation, and find a buyer for the property.  The question I have for the community relates to how much you feel is fair to compensate this couple.   My husband and I feel like in essence, they are acting within their professions of realtor & contractor and that their compensation should simply be the commission from the purchase and sale of the property, and the contractor fee for managing the renovation. This couple has suggested that they receive that compensation, AND a percentage of the profits from the sale. Given that we are carrying ALL of the financial risk, I am having a hard time seeing why this would be reasonable or fair. We have never done a flip before and have obviously not worked in partnership with anyone to do one. I'd love to get the thoughts of anyone with some experience in working with partners for flips. How have you structured your deals? How is the risk generally distributed? And do you think a percentage of the profits is a fair ask by this couple. We are under contract on a property that feels like is a great deal, so we have started talking this out with the couple to see if we can come up with an agreement. Thanks for any insights you can send our way.

[Will Barnard]

I am failing to see why their partnership portion is 50%. I think you need to rework your numbers. You would be better served hiring a project manager in the area and a realtor and keeping 100% less the costs of the PM.