Should I have a partner?

Question

My wife and I currently own a rental property and plan on turning our primary home into a rental this year. I want to add a partner to help our rental business grow while my wife wants us to continue to fund it on our own. I have a partner who has expressed a lot of interest in being an investor. I need help determining whether it is a good or bad idea to bring in an investor.

Note: current rental cash flows 200 dollars per month after accounting for expenses and our houses projected cash flow is 200 per month if se don’t refinance. On the rental we have a 4k dollar bathroom remodal happening this month that we owe about 2.5k out of our own money (not rental) and just today the renter emailed us about a leaky roof.

Brandon Rush · Answer

Hey Luke,

I personally see partners like I see my spouse. I think you need to go through some baby steps with them to see if you would be the right fit for one another. Maybe there is an opportunity for a short term project such as a flip? You never know how someone operates until you work with them. You also need to make sure your short term and long term goals are aligned. If this is not done from the start, you are bound to have many disagreements.

I do think there are many upsides to a partnership as a team allows for diversity of skillset, funding, and responsibilities. You just need to make sure you put in the work necessary to make sure this is the partner for you.

In the end, whatever you do, make sure your operating agreement is written up by a lawyer. Do not go off of trust.

Good luck Luke!