|Real Estate Information|
Joint Ventures In Real Estate Development; So How Do They Work?
There are many reasons why you would consider joining with another person to undertake a development project in Joint Venture.
Usually the most basis reason reveolves around something you don't have.
Some of them may be:
1. I own land ... have capital & capacity to borrow ... but no experience.
2. I have capital & capacity to borrow ... partner has land ... both have no experience.
3. I am 'time poor' ... work full time and can't be personally involved ...
Let's suppose you want to find a land owner who will put their land
Let's consider the implications of entering into a JV in the first place.
After all, in a JV you have to take into account another persons attitude, decision making process, (or inability to make a decision), whether they have a logical and sensible mind ... the list goes on.
So, getting into a JV must have a good payback for you. Whatever you lack is usually the reason for entering into a JV.
I have noticed over the years that JV's have a prime motivator, the driver of the deal (you), and the other person is along for the ride.
Another example: maybe two individuals who have saved their capital, however individually it is inadaquate to undertake a project. Combining their capital and borrowing capacity will allow they to proceed.
I prefer a JV where both parties are equally motivated, have different skill bases, but each regards the other as contributing equally.
Don't forget why you got together in the first place.
So there are many reasons for JV's. However, you must be clear as to why you are doing it, and it must be secured by a legally prepared JV Agreement.
A lot of 'practical people' hate legal documents ... a JV Agreement is a legal document and both parties must understand what it says. If one of you is a bit slack on this point, it is up to the other to sit them down and go through it ... it's important!
Suppose the JV deal hits a rough patch and your partner says, "I didn't know that ... why didn't you tell me ... I left all that legal garbage to you ... blah, blah." Got It, have the arguments at the beginning of the deal ... not later.
A JV Agreement sets out what each party will contribute, both money and effort, and sets out each parties obligations. It also sets out what happens if the parties 'fall-out' with each other as well as the division of profits or losses.
There is a lot more at stake if you JV with your rother-in-Law, other relatives etc ... the term 'on-going-nightmare' is a phrase that readily comes to mind.
And if one of those family JV's brake down, it dosen't matter how many pages are in the JV Agreement, or what the words say to prove that you are "RIGHT," ... as far as YOUR Brother-in-Law is concerned, you are a 'expletive deleted.'
Just thought I'd get that out of the way!! OK?
One more thing ... doing a JV with a rich person, when you are many levels poorer then them, is also not smart.
Well, in simple terms, when 'push comes to shove' money rules ...
Also, if the rich guy tell you not to bother with a JV Agreement ... he appears to be saving you money ... tempting eh? ... what he's really doing is taking away your legal rights.
Yep, you'll have less rights than an employee. If that's the deal ... better to be an employee!
In my my ebook I emphasise the importance of getting the Structure Work of the business organised - you will build a much better development business from a secure foundation.
When you are doing your interviewing of the associated professionals, try to see if they, personally, have any entrepreneutial tendancies.
They may have land, houses, houses for renovation etc but don't have the 'TIME' or 'SKILLS' to do the work themselves.
Don't come out and ask them straight away ... follow my ebook, do the work you want to do; that is assessing them ... but keep your antenna out for any signs of a common interest.
OK, back to getting hold of some land.
Get to know the local real estate agents; I mean know them well.
Call in and buy them a cup of coffee, take them out of their work place;
Invest your Time in finding good, well informed, dedicated agents. Believe me they are in your business community ... it's your job to find them.
Appreciate that Agents are essentially self-employed, irrespective of whether they work in a Real Estate Agency ... their 'mind set' is independent.
They back themselves and their abilities to provide a sales service at a
That 'good income' by the way, will leave most of their 'client's' income
The 'good agents' are busy; their 'time' is money; literally. So don't mess them around.
Don't talk to them as though you are the Aga Kahn! You're Not. There's always a guy richer than you ... maybe the Agent!
Why am I making such a big point about agents.
I believe "people" get the agents "they deserve."
I have heard people talk to Agents as though they were some grubby leech on society and are doing them an honor even to talk to them.
To be a successful agent these days you have to be very good. Many are highly educated and choose real estate as a career for the freedom,
What comes out of your mouth + body language tells an agent a great deal about you. They then wonder why the Agent never calls then ... Dong!!!
Keep your 'ego' under control. Their sales success rests on their ability at 'reading people.' Remember what I say in my ebook!
When you are in the development business, you are in the business of:
Getting People To Do ... What You Want Them To Do
That means that you have to be in control of 'How You Treat People.'
While you are doing this "work" don't forget to do what my ebook tell you
Last idea for finding JV people - talk to your friends - put an advert in the local newspaper seeking expressions of interest from people interested in doing what you want.
OK, you've found a partner who has the land and you are comfortable with the relationship after several meetings.
Important question! What value does your prospective partner put on his land that will be put into the JV?
Just throwing a few figures around to give you an example.
Let's say that market value for his land right now is $300,000. But he wants to put into the JV at $400,000. So if your JV Agreement involves you gaining a share of the profit, your share will be $100,000 less. Got It?
Now let's say that part of your skills contribution to the JV includes a
Your efforts have increased the land value significantly ... no, not six times, as house properties are valued differently to multiple unit properties. But it may have increased by 3 or more times, depending on your market.
Once again the $100,000 will come off your share. Now that may be OK by you, because you are just starting out on your first development ... it is always better to KNOW what you are agreeing too.
I hope this information helps you in your consideration of entering a JV.
Writing things down is an aid to learning and remembering.
My LAST DON'T ... Don't start any of this JV stuff until you know my eBook
What I am all about, is helping you to do residential development with the RISK reduced.
If it takes four years study to get a basic Degree and say another five years to get some experience, why would you think that you can enter the development business with little study -- no experience and expect to be profitable?
"Residential Development Made Easy" is written by Colm Dillon, the 'Real Estate Development Coach' and is the only 'How To Become a Residential Real Estate Developer's eBook on the web; it's selling in 38 Countries, from his experience of developing $1.2 Billion worth of real estate - read more on his web site http://realestatedevelopmentcoach.com/realestatedevelopment.html
New Data Shows Strong Sustainability Improvement in the North American Real Estate Sector - Markets Insider
Getting Raw Land, Not a Raw Deal!
There is more to buying raw land than meets the eye and more than a few individuals have wished they'd had a second chance upon finding themselves duped, conned, misled, ill-advised, uninformed, oversold, undereducated and often unprepared. They realize, often too late, that a raw land purchase should be properly investigated, evaluated and negotiated using a logical and rational plan.
Preserve Equity, Build for the Future Using a 1031 Tax Exchange
Thinking of trading up on an investment resort property? If so, look into 1031 Tax Exchanges (based on IRS Code Section 1031), which allow taxpayers to defer taxes on capital gains resulting from the sale of investment real estate, often a sizable sum since combined Federal and State taxes can run as high as 38 percent.With an exchange, owners are able to preserve equity, while still selling the property.
Real Estate Investing - The Marvel Of Home Depot And Lowes
Repairing a rental home (or your own home) use to require running down to the local hardware store or to the nearby building supply house. After several stops around town, you found everything you needed to solve your maintenance problem.
Buying Property In Spain
It's high time someone advocated the use of common sense and suggested that those people looking for that dream home in Spain actually apply a cautious approach to buying!After all, real estate is such a significant purchase for most people that you'd think people would be only too ready to think twice and long and hard before committing to purchase - especially when buying abroad where the rules and customs differ greatly to what we may be used to.But it seems that so many people are seduced by the sunshine in Spain and by aggressive and slick agents and developers that they are willing to purchase unseen, to buy off-plan or even remotely via the internet and to basically purchase without the slightest clue about just what it is they're getting for their money.
The 5 Biggest Mistakes Made When Getting A Business Appraised
Most business owners will, at some point, want or need to know how much their business is worth. They will be faced with the task of finding someone to perform a business appraisal or valuation.
Dont Get Stuck Having To Deal With The Sellers Household Hazardous Wastes - After You Move In!
I have a confession to make!I was just outside with Frankie (my dog) and noticed I stillhad an old car battery sitting by the foundation, at therear of my house.Yes, I'll admit it's not right, and quite environmentallyinsensitive for me to have it there.
Saving for a Home
So you want to buy a home? This is a big step for anyone, and there are many factors to consider, not the least of these is how to get the money for a home. Sure there are loans available for home purchase, but you must have cash on hand to cover expenses such as fees and closing costs that might not be able to be covered by a loan.
Minneapolis Warehouse Loft
Downtown Minneapolis is rich with true metropolitan charm. With the growth of an incredible entertainment district, a wonderful artistic community, and all the opportunities of a large urban center, downtown Minneapolis is pleasantly thriving.
Realities of Real Estate Investing
If you are anything like me, you are always looking for a good way to work for yourself and make tons of money. Is this not the dream of millions of Americans? Of course it is, and I am willing to bet that you have considered getting into the real estate market at some point.
Finding the Right Buy to Let Mortgage for Your Investment Property
Finding the right buy to let mortgage is crucial to your success as a property investor. Unlike other forms of investment, a lot of the money you put into a buy-to-let property is likely to be borrowed.
Home Loans - Identity Theft Protection Could Hurt Home Sales
Identity theft has been a hot topic in the news during the last few years. Just a month or so ago, forty million credit card numbers were compromised due to a computer attack on a credit card processor.
Real Estate Professional in the Palm of Your Hand
GETTING THE MOST FOR THE LEASE-TRACKING YOUR REAL ESTATEIf you own rentals and/or investment properties, you know that you have to keep track of your portfolio, maintenance profiles, property managers, and related financial matters. There are a multitude of programs for the Palm-Pilot system to keep up with lease dates, lease expirations, and rent due dates.
Purchasing International Real Estate
Interested in investing somewhere other than your back yard?Management companies have made it as easy to have a revenue property across the world as it is to have it across the street. You don't want to be collecting rents and plunging the toilets no matter WHERE it is!Different laws in different countries means some research is definitely in order.
The Real Estate Agent Alphabet
Alphabet Letters after a person's name seem to bestow some kind of special prestige. PHD, MD, ESQ are common.
How To Best Negotiate A House Deal
Whether it's selling your home or buying a home, more often than not you'll come across a stage where you'd have to negotiate. Negotiation is the art of getting what you want at your terms and conditions.
Selling Houses: Design Psychology Works!
I've taught the concepts of Design Psychology for many years, and I know how much it can empower a person, and allow them to create a fabulous home that sustains their emotions. Since it's based on science, I know that Design Psychology is effective at turning plain spaces into happy places.
Types of Listings with Agents
There are several different types of listing contracts. Few of them are detailed below:Open ListingThis type of listing is when you, the seller, don't want to commit to any one particular agent and when you are also open to selling the home by yourself.
Property in Bulgaria - Huge Investment Potential
Bulgaria is a truly magnificent country, located in Eastern Europe with an amazing coastline that stretches over 340km along the Black Sea, with a backdrop of one of the world's most magnificent mountain ranges and the beautiful and historic capital city of Sofia.Today Bulgaria not only offers one of Europe's most attractive and unspoilt holiday destinations it is also host to what will be one of the most dynamic and as of yet relatively untapped property and real estate markets.
How to Buy a Property in Bulgaria
The CostAlthough the property prices in Bulgaria are quite low compared to the other European countries, there is still a wide variety of prices depending on the property type and location (as a rule the properties in Sofia and at the Black Sea are more expensive). The first thing you will need to figure out is how much you can afford to spend and thereafter to determine the price range for your purchase.
How to Price Your Property?
A house properly priced is half sold. But there are plenty of ways to price it improperly.
home | site map | Blog |
Exchange Links Here | Links page |