New to the Game - Getting Started
Hello All,
My mother-in-law and I have been discussing working together on real estate investments for a few years. She's getting close to retirement and wants to get her feet wet now so she has something to keep her busy during retirement. Our strategy is to buy foreclosed or short sale single family homes and flip them.
Some background: I work as a project manager for a very large new-construction general contractor. I have close relationships with dozens of contractors in any and all trade areas. My mother-in-law was previously a Realtor, but this was 30+ years ago and she recognizes that times have changed.
She is good at finding properties; I'm good at the numbers behind the deal. She'll be our go-to for buying and selling; I'll be overseeing the contarctors. She will be the majority of the funding on jobs.
Neither of us have connections with lenders (outside conventional mortgage types) - this is something I'll need help with in the future.
As for now, I want to discuss with her about starting an LLC. I understand the importance of this from a risk standpoint, but a sticking point will be ownership share, and therefore profit sharing. In our situation, what type of ownership split should be expected? Is 50/50 fair for me to suggest? I recognize she will be providing most, if not all, of the seed cash to get us started.
On another note, If we're doing 1-2 homes at a time, how much time should I expect to dedicate per week? I'm used to running one job for 18-36 months, $50M +, so this is a much smaller scale for me. I just want to make sure this won't require a plurality of my time before I jump in.
Thanks in advance.
Doug