Get rid of debt, build a budget, and save.

I would be putting 20-25% down and use a loan to get more for my money. 

So I throw them a bone and take money off rent for them to work on them over time.

Allowing people to “know the space” before they come out will save you an enormous amount of time by prescreening people who have no interest in that rental’s layout.

There is still money to be had and a lot of opportunity but just make sure your location is good.

I think you may want to start of the arrangement in a more simple fashion.Ask for a loan in which he will get a stated return 6% to 12%.If you are both successful happy with this arrangement, upgrade to a partnership.I think a partnership off the bat makes things complicated.You will also likely make more money in a loan agreement if the project does well.

I was intrigued by the fact that you don't need a lot of money upfront to get in.

You can even get better with CDs and money market with no risk.  

They should be paid off with the property’s insurance money.

We have a relationship with a much larger developer who does multifamily, mostly apartments, and even they can't figure out where to put their money right now, because the math just aint mathing for them to build or renovate at the moment.