Structuring Deal For Financing Partner

[Vanessa Zamy]

Hi, I'm structuring a proposal in search of a financing partner for a single family househacking deal in which I stay in one room serving as on-site property manager for at least one year and rent out the other rooms in the home. 

Question: What are reasonable returns and "good" deals in the market these days?

For option 1, where I take on a financing partner giving me a loan, I've forecasted for fixed 8% interest rate, 30yr term, with a house sale in year 5. Without a house sale, cash on cash for my partner is 44% at about 9% each year. Is this a good deal for my partner especially with no work or headaches on their part? I think so, but would love to hear thoughts on whats available in the market and what you think.

For option 2, where we enter into a joint venture agreement, I'm offering them the first 10% of monthly cash flow then a split 50/50 of the rest of cash flow. If I move out year 3 (adds a room to rent) or stay through year 5, then factor in expense percentage increase greater than rental increase, my partner could get anywhere from 40-80% 5-year cash on cash with 9-20% annually. Is this a great deal for my partner? I think so, but would love to hear thoughts on whats available in the market and what you think.

Potential financing partners would be from those just starting out and varies all the way to those who may have some experience., so I want to ensure I'm structuring a deal that is amazing

Cheers,

Vanessa