Many real estate investors hesitate to go for the real estate investment partnerships. They all want to do every deal on their own, and they do not like the idea of sharing the ownership or decision-making authority with any other investor. However, real estate partnerships carry tremendous potentiality for profit. In recent years, the conception regarding the real estate partnerships has changed dramatically. Investors are joining hands with each other for many real estate ventures. 

What does Real Estate Partnerships mean?
When two or more real estate investors legally join hands to do a common venture with mutual consent, it is referred as real estate partnerships. They are contractually associated with each other for a real estate venture, and work together on a joint principal. 

What is the benefit of Real Estate Partnerships?
Real estate partnerships can be an excellent decision for your real estate career. If you are looking to grow up at a rapid pace and want to make your portfolio a well-known name in the real estate market, it is very unlikely to do that single handedly. Let me explain the reason to you. You require three important factors in order to ensure your success in the real estate industry. These three factors include time, money, and expertise or knowledge. Well, if you do possess all these three things, you really do not need any real estate investment partnerships as such. However, it is very unlikely to find all these three things in a single person. You might have money and expertise, but not necessarily have the enough time to spend on building strategies for various real estate deals. 

Again, you might have the expertise and time, but may not have the sufficient money to invest. There can be a third scenario as well. You might have enough money and time with you, but you might not have the expertise required to ensure a successful deal. All these permutation and combination leads to a single conclusion that when it comes to ensure big success in real estate industry two minds are always better than one. It is where real estate investment partnerships emerge as a very lucrative decision and an excellent move. It is certainly going to give you the much-needed flexibility in doing various real estate deals. For example, if you have the expertise but lack sufficient time because of your other engagements, you can work on building the strategy, while the remaining work, such as, dealing with the seller etc. can be done by your partner. If you succeed building a good mutual understanding with your partner, real estate partnerships are certainly going to give your real estate career a boom. 

Choosing the Right Partner
The success of the real estate investment partnerships lies in the decision, which you take while choosing your partner. You must take into consideration many factors before you choose your partner. Always remember that a good friend cannot necessarily be a good partner. Therefore, your main objective must be to choose a partner who is knowledgeable, honest and analytical minded. However, the decision will widely vary depending upon the nature of real estate deals you are involved in. Still, if you are looking to expand your portfolio by jumping into other ventures of real estate, which you never tried before, you must look for a person who has good experience in that field. Apart from this, you must keep some common criteria while choosing the partner for real estate investment partnerships, such as, the partner must be honest, fair, and understanding etc.

Make it Legal
Once you have chosen your partner, make the real estate partnerships legal on paper. Prepare a legal partnership agreement that should include the terms and conditions of the partnership, such as how will the partnership work, in case of any dispute what will be the course of action, etc. Everything should be properly documented and signed by both the partners. While you are preparing the papers for real estate partnerships agreement, make sure to include all the possible scenarios, and the consequent course of action. It is always better and prudent to get the agreement drafted by an attorney. When everything is finalized, make two copies of the agreement, where you will keep one copy, and your partner will keep the other. 

Overall, if you take proper care while choosing the partner and then documenting the agreement, there is no reason why the real estate partnerships should fail. The main reason why real estate investment partnerships do not succeed is the lack of communication and misunderstandings with each other. Therefore, you must do things in a way that should not give rise to unnecessary suspicions.

 

Do you own real estate articles or stories and want to share with other investors? 
You have chance to win $100 Amazon Gift Certificates. We will give away 3 prizes for top authors each month!

Email your articles or stories to:  articles@buyincomeproperties.com

 

© Copyright 2001 - 2010 by BuyIncomeProperties.com               

 

 

Visit Real Estate Forums for every real estate investing topics!  Enter Here

    

Top of Page