Here’s the situation:Key Project Details:•Property Size (pre-renovation): 250 sq. meters (2500 sq. feet)•Purchase Price: 250,000 EUR (1,000 EUR/sq. meter)•Renovation Costs: 750 EUR/sq. meter (includes kitchen, appliances, quality furnishings)• Loan costs (during renovation and renting): 350 sq. meters (due to attic expansion)•Property Size (post-renovation): 350 sq. meters (due to attic expansion)•Post-Renovation Layout: 2 separate apartments•Airbnb Income (24 months): 2,500 EUR/month/apartment (= 5,000 EUR/month)• Other running costs: 600 EUR/month•Projected Sale Price (after 2-3 years): 850,000 EUR (approx. 2,500 EUR/sq. meter)•Closing Costs: Negligible in Tbilisi•Real Estate Agent’s Fee: Typically 3%, but negotiable based on who hires themFinancing Setup:•Property Purchase Financing: 100% bank financing at 5.9% interest (bank has even financed 150% to cover some renovation costs in the past)•Renovation Financing: Our friend is offering to finance 250,000 EUR in cash for the renovationsProposed Partnership Structure:•Work Involved (on our side): Full renovation (10-12 months to complete), furnishing, and property management through Airbnb until the sale (2-3 years)•Profit Split Proposal: 60% (us) / 40% (friend providing renovation financing)Questions for the Community:1.Does the proposed profit split (60/40) seem fair, given the work we would handle (renovation, furnishing, property management)?

And when you sell it if you meet the primary residence requirements the profit is tax free.It is possible in many instances to own successful rental real estate that generates real dollars in your pocket but operates at a loss for tax purposes. 

I manually go through every transaction to drop in the right "bucket" to figure out our profit for each deal and then I give to my CPA. 

As a result, my profit decreased as buyers began negotiating for lower assignment fees, using the leverage they had developed.

Instead, it might be more beneficial to focus on maximizing your profits from the flip.

One common obstacle is dealing with higher interest rates compared to traditional financing, which can impact profit margins.

It is much more competitive and therefore not as profitable and more risky than those selling books imply. 

Holding a flip for a few extra months can erase lots of potential profit.

Are the multifamily properties in those places profitable?

They deliver the unit, service it, keep it stocked, etc. and then you split profits.