All Forum Posts by: Bo A Vanecko

Jon,  thanks for the reply.  too confusing I agree.  I appreciate the heads up on this as I need some skin in the game as well :)

Hello,

I was recently at a local neighborhood get together and long story short met someone who is quite active in investing (15 plus years experience) and proposed a passive partnership that I could also learn from as he pitched it. All specifics havent been worked out but wanted to see if this type of "partnership" is heard of or what others thought.

Basically they have a home they are earning some good CoC on and what they would like to do is offer up my putting in most of their original investment costs (say for arguments sake 30K). In return I would get a passive check of 10% CoC on the property. They would keep the other CoC they are earning. (example...they are currently 18% CoC and by my providing 30K i get 10% they get the 8% as a "management fee" so to speak). I technically do not have to manage the property at all but they offered to have me shadow them to learn from this as well.

we also discussed my getting an equity stake in the property ...say 60% and they retain 40% equity should there be a sale down the road or any HELOC or refi etc.

also discussed were buy out terms should I want my initial cash out to move on etc.

anyone ever have deals like this? thoughts?

thanks,

Bo

Hello,

I was recently at a local neighborhood get together and long story short met someone who is quite active in investing (15 plus years experience) and proposed a passive partnership that I could also learn from as he pitched it.  All specifics havent been worked out but wanted to see if this type of "partnership" is heard of or what others thought.

Basically they have a home they are earning some good CoC on and what they would like to do is offer up my putting in most of their original investment costs (say for arguments sake 30K). In return I would get a passive check of 10% CoC on the property. They would keep the other CoC they are earning. (example...they are currently 18% CoC and by my providing 30K i get 10% they get the 8% as a "management fee" so to speak). I technically do not have to manage the property at all but they offered to have me shadow them to learn from this as well.

we also discussed my getting an equity stake in the property ...say 60% and they retain 40% equity should there be a sale down the road or any HELOC or refi etc.

also discussed were buy out terms should I want my initial cash out to move on etc.

anyone ever have deals like this?  thoughts?  

thanks,

Bo

@Travis 

@Travis Evenson Thanks for your input.  Basically, this person has lived and invested heavily in these areas for 10+ years.  He is currently actually consulting at the company i work for here in Boulder CO and I met him b/c heard me listening to BP podcasts and he also started asking questions about my thoughts on real estate etc (without telling me he invested).  As we started talking more he told me his story and told me about other books etc to read.  i started bouncing Denver ideas off him and he suggested ultimately that i look elsewhere to start.  That is where i began discussing that OOS would be tough b/c i would have to find a strong PM.  Conversations moved from there.  ultimately, i will be investing my own money and he is willing to drive me around the area to better understand the market, housing, people, etc.  He offered up the discounted PM fee as a way to help me get going and better understand the ins and outs.  We have since spoken about some long term goals and partnering on future investments b/c he loves my academic background and ability to analyze properties etc.

down there i can get some deals in the 15-20% COC range where here in CO it would be extremely tough to do so. Start and learn OOS and then potentially move to some bigger stuff here in CO is what i am thinking.

so for now I am heading down there over thx giv to look around the place and see what is what.  

@Ronald Rohde  Thanks for the heads up.  From my research, this is a "niche" that does offer its set of both excellent returns and potential "excellent" headaches.  

After speaking to a few investors who have had skin in the game now for over a decade, several mentioned the idea of having one person (wife or myself) become a real estate professional and then start the business of investing etc.  This then has the advantage of not limiting the passive income loss filing for tax purposes.  

curious if people on here have some thoughts pro/con on this as well as peoples experience on how this would even work in the Denver area (ie requirements to do so, how to maintain this title, etc).

mean while i will continue to read up on it...seems CO requires like 168 hours of class and then passing the test at a min.  

thanks all 

Bo

@Chris Lopez  funny how we have to "disclaim" advice all the time in todays world...another topic ...

thanks for the heads up ...  I am pretty sure we are thinking the same thing and if nothing else, keeping good tabs allows me to write off if it is possible...  so better safe than sorry :)

bo

@Chris Lopez  Saw you mentioned "writing off the mileage" etc.  I know that once I am actively investing all these types of trips are tax deductible, but if I do not currently have any, can I still write it off?  Or is a better way to look at it that I simply keep all tabs on a trip down there and if I do end up purchasing, I can then use all this for a write off on my taxes?

I guess I had not considered that even though I don't own yet, when I do, this could actually be something I place on my taxes.  I will begin some good book keeping and also keeping all receipts etc just in case.  

Thanks for making me think of this :)

@Chris Lopez  thanks for the info.  we have been building a strong relationship over the last 2 months.  he is the reason i am on here and have listened to over 20 pod casts etc.  that said i am well aware of his financial interest in this partnership so that is the item i am focusing on mostly.  i have had three dinners with his wife and him now and this would be the first opp to meet and see his area etc.  
appreciate your honesty here etc.

@Neil Aggarwal  thanks a ton for the advice.  he is bit on the "c" areas i guess (areas that arent "dont go out at night" but may be areas i personally wouldnt live with my fam).  its been his niche when he started and he has continued it.  this area i guess is somewhat in that ballpark. 
im planning a family vaca for thx giv and will likely drive around during that time frame.

thanks all

Bo

All,  

I have been learning a bit from a mentor who is a very active investor in the DFW area while I currently live OOS in Denver area.  Considering the Denver market I was speaking to him about approaches to investing in Denver etc and he suggested I come down and do some driving through areas that he is very active in.  He further offered to help me invest if I found something and would not only have his team (wife is a RA) help with the purchase and all the documentation regarding being a landlord but would also do the management of the properties for me at a price of 6%.

The area he is actually fairly active in is south of the city and east of 35W.  between 30 and 20 east of 35W

What are peoples thoughts on this area or are there some suggestions on areas around there?

What are peoples thoughts on this kind of management fee plan?

my thoughts were to run a family vacation to dallas over thanksgiving and use this time to do some driving around the area to familiarize myself with the properties etc and get to know the mentors team etc.

Just seeking some input as I look towards my first purchase.....it is that 90 day challenge time after all :)

Bo