I met an investor that thinks I would be great as a real estate developer. He trusts his intuition and chooses people he trusts to use his money to make more money. He wants to pay cash, write a check, and that be the extent of his work.
How do you think I should structure the deal? Should I suggest rental or resale? If we sell it, should we go 50/50? Is that insane? He wants to buy in a neighborhood that I really want to live in as well. So if it was a multifamily and we rented it, I could live there while we renovate and beyond.
Any thoughts on what would be a good deal for me? Thank you!
What are this investors goals? Does he want to make a return on his cash investment, or acquire rental properties, or flip homes?
If he wants to earn interest on his money, then use him as the bank. Just like you would for a traditional loan, have him finance a property that you are looking to invest in.
If he wants to acquire rentals, you will have to work out a partnership on who is tackling what. 50/50 is not absurd if all he is doing is writing the check and you are finding the deals, working with sellers/attorneys, overseeing rehab of said properties, managing the rentals and finding tenants.
If he wants to flip, similar to above, you would need some clarity on the extent of his involvement. If you are doing all the work to include overseeing the renovation and sale of the property, 50/50 is not unreasonable.