Why Joint Ventures!!!!

[Ron Biggs]

Why do I think JOINT VENTURES are such a great way for real estate investors to grow their business and for someone who’s looking for a great passive income???

I have been talking about joint ventures quite a bit lately and have had several people ask me what are joint ventures and why I believe in them so much so I thought I would spell out my thoughts on just this topic.

Of course, there are untold numbers of things you can do with joint ventures (JV's) but I will be going over JV's concerning real estate investing and for this discussion building a rental portfolio.

I truly do not know a better way for an investor to build their rental portfolio and at the same time your finance partner have a truly great passive income!

The two partners that make up this type of JV are:

-the real estate investor

and

-the person who provides the financing

The real estate investor provides the knowledge to be able to:

-find the right kind of property

-negotiate the best price possible

-handles the closing working with an attorney

-renovates the property which includes getting the best pricing and overseeing all the construction

- finds the best tenants and manages the property

The person who provides the financing:

-provides the financing – and that’s all. So, it is a truly passive income secured by real estate.

Sounds simple doesn’t it? It is as long as you get the right property at the right price and rehab it to be a great home for your tenants!

Here is a real life example of a property we are getting ready to do to show you how a JV is such a benefit to the real estate investor and the person who provides the funding!

The property is a 3 bedroom 1 bath house in a nice area and the area is improving. Below are the numbers associated with this house.

Purchase price $75,500.00

Rehab cost $28,500.00

Total invested $105,000.00

After repaired value will be $140,000.00

This equals $35,000.00 in equity

The rent will be $1,195.00

How does this financially benefit the investor and the person providing financing?

This varies on each deal but on this property, we are doing a 50/50 split so when the home is renovated the 2 members of the JV have $17,500.00 in equity each. They also will split the rent proceeds after taxes and insurance which will end up being about $522.50 going to each. So, at the end of one year each will have earned $23,770.00. This is after just one year! Of course, a longer term provides even more returns! Plus, all are protected as the property was bought and rehabbed at 25% under value.

This are just some of the reasons I believe this is a great way to build a rental portfolio and for the person proving financing to make a great and well protected return.

Any questions or comments fire away! Happy Investing!!

By the way these are just my thoughts I am not an attorney or accountant and not selling anything so this is free info and that may be all its worth 😊

[Joseph Firmin]

@Ron Biggs, completely agree. A JV can be very beneficial. They can take on different shapes, such as 2 investors pooling resources and time together to invest, get more done faster.