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Updated over 4 years ago on . Most recent reply

User Stats

4
Posts
1
Votes
Ed Sena
  • New to Real Estate
  • Livonia, MI
1
Votes |
4
Posts

Fix and Flip Investor Deal Structure

Ed Sena
  • New to Real Estate
  • Livonia, MI
Posted

Hey Guys,
Looking for advice on how to structure a fix and flip deal to potential investors. We have several good financing options. As we look to scale, bringing on investors is just one option. Below are the numbers from our first 2 deals:

Investment #1:
Purchase Price: $40K
Renovation Budget: $60K
ARV: $$240K

Investment #2:
Purchase Price: $50K
Renovation Budget: $50K
ARV: $170K

As a potential hands-off investor what would you looking for and consider a great return for your investment of….
Scenario 1: You invested 50% 
Scenario 2: You invested 75%
Scenario 3: You invested 100%


Assumptions + Caveats
Investor will be hands off and simply looking for a return
For sake of argument let's assume our budgets and ROI numbers are accurate and we can deliver these outsized returns.
Assume we have the team in place to find more of these gems and are able to execute
We have other financing options and private investors is attractive because we believe it would allow us to scale quicker

Any examples of similar deals you have been part of or have insight into, would be greatly appreciated. And explanation of what made your deal structure attractive would be helpful. 

Thanks in advance for all the great insight and guidance!

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