All Forum Posts by: Melissa Dorman

Hey all, 

I'm creating a joint venture agreement next year for a buy and hold agreement (an equity partnership and I would manage the units). I want to make sure I have all the clauses and questions answered in the actual document. I have seen this go wrong by others in the past when the other person dies, or tries to exit the deal prematurely, or doesn't pull their weight. Any specific clauses I should include? What components are important? (ex exit strategies, who/when profit distribution etc.) 

(Also, if you are willing, could you personal message me a doc you have used?) 

Great article. I love that it is a win-win-win deal for all involved. I will definitely keep this in mind whenever I have a house that needs dismantling. 

@David Goossens I couldn't have said it better! Those books are great reads and have been a huge help this past year as I began studying real estate. I would add What Every Real Estate Investor Needs to Know About Cash Flow... And 36 Other Key Financial Measures by Frank Gallinelli. Much like those above, I work the 9-5 job and do side hustles to fund my investments. I'm currently searching for my first purchase, a small multi-family. I want to do a buy and hold strategy personally. A lot of people get caught up on cash flow, which is super important. Don't get me wrong, I can't wait for financial freedom! But also note the merits and the power of equity. Often a high cash flowing portfolio doesn't appreciate well (cheap properties in low appreciation areas). It sounds like your goal is to get out of the rat race. Cash flow is pertinent but long term wealth is more easily found in equity. Best of luck!  

thanks @Jay Hinrichs! that's good to keep in mind. Even when I go to pick up a larger complex out of state, I will still need to be conservative in my returns and invest in nicer areas/properties. I guess, cash flow is not king if you loose your shirt in a war zone. 

@Steve B. what are some zipcodes for class C areas? (I want to buy a fourplex in the next 6-8 months in/near the Portland area). I have heard St. Johns and Gresham and Beaverton are places to keep my eyes one. What are your thoughts? 

I can only hope my first rehab does as well! Great work. Looks like a real family effort and all the work paid off. that's how to do it! 

Welcome to the community! And best of luck in your real estate goals. 

@Jay Hinrichs is right about going for the big wealth of appreciation and starting with a small mulit-family on an FHA to maximize your ability to manage and get cash flow in a tight market. There are a lot of people willing to buy out of state and make a few hundred bucks a month, but have close to no appreciation over the years. Not to mention if they have an issue, one trip to fix the situation costs them all that cash flow. It's a rookie move that I almost went for. Better to start with the appreciation move first, I think. The big wealth comes from collecting homes that appreciate, even if they just break even. Once you have some equity growing and know how to run a tight business, pick up a larger multi-family out of state where the numbers make sense using economies of scale. You can put in a manager and get all the cash flow then.

Thanks @Tim G. and others for all the help. Looks like I'm ready to send out my mailers and snag my first deal! 

I suppose it's all perspective. I'm living in LA now and about to uproot to live in Portland because the deals look AMAZING compared to LA! In LA, you get a duplex for $500,000 that collects $2,000 in rents (and that's a 'good' deal). In Portland, I see duplexes for half that price on zillow and redfin with better rents! Portland is definitely booming but it has not caught up to the other major west cost cities like san fran, LA, and san diego. No to mention, currently no rent control, so rents can stay at market value huge plus!) Appreciation will likely keep coming, but for small multi-families (especially off market), I think there is cash flow to be had!