Investing in Real Estate With Your Significant Other or Business Partner
It’s actually pretty common to find individuals tackling the sport of real estate as a team. Some go into business with their significant other, their families, or an individual they’ve developed a business relationship with. While real estate can be a one person business, the synergy that is experienced with a team is unmatched.
Let me make sure I say, the RIGHT team.
Some environments just aren’t contributing to your growth and should be avoided in order to further your career and business. When you do find the right environment, the collaboration will feel smooth and progressive even when things get tough.
Why Partnerships Work
“If you want to go fast, go alone, if you want to go far, go together.” – African Proverb
We all know that each individual has something unique that they can offer the world. The same can be done for your business. There are undoubtedly more than enough individuals who can add value to your business; if you find them. Finding them comes from your hustle and efforts in order to attract those individuals into your life. You have to be able to add value to someone’s business or they’ll be wasting their time. How do YOU feel when someone isn’t adding value to your business?
There are 3 components to the perfect real estate investor: Money, Hustle, and Knowledge. Fortunately, you only need 2 out of those 3 components to be successful.
You can have hustle and knowledge, but no money
You can have money and knowledge, but no hustle
You can have hustle and money and not know what the hell you’re doing!
This is where partnerships and teamwork come into play. What you lack, someone else excels in! Whatever you have more of, somebody has less. These are the harmonious relationships that can have you thriving!
In fact, one of the main reasons why people don’t get started in real estate is because they “don’t have any money.”
I won’t sound like those typical ‘’flip homes with no cash or credit” gurus, but it is 110% possible and accomplished in more ways than none.
Instead of focusing on the money that you lack, do you have the knowledge and hustle to solve a problem? If you can solve a problem, you can find the money. In fact every business ever created was to solve a problem. Real estate is no different.
Recently I was negotiating a deal with a seller in which I was offering to pay $50k in all cash for their property and close in 2 weeks.
Did I have the $50k at that exact moment? Nope. But with two week’s time and a few sources, raising $50k collectively for an amazing investment opportunity isn’t as hard as you may think. As I mentioned before, there are more than enough people who have what you don’t.
Are there investors who have the knowledge and money but don’t want to spend their time and energy finding deals? Of course.
If all you had to do was sign a check and get a double digit ROI on your money in 3-5 months, would you do it? Of course you would.
So would hundreds of thousands of other individuals; and that’s why partnerships work.
Investing with your significant other
“If your significant other is mad at you, put a cape on them and say ‘now you’re super mad!’ if they laugh, marry them.” – Anonymous
Let me guess how some of your Friday night conversations go:
“What do you want to eat babe?”
“Um…. I don’t know, it’s up to you, what do you feel like eating?”
OR
“What do you want to do today babe?”
“I’m down for whatever, what do you want to do?”
As you two debate back and forth, you eventually find something that you two mutually agree on and happily enjoy the rest of your day or evening.
Let me be clear when I say this only works with Friday night plans for enjoyment, not investing activities.
The plan/goal should be clear from the start and agreed upon by both you and your significant other. This may or may not be an easy process, but it is the most important and should be identified first. The two of you must understand that working as a team now adds an extra level to your relationship, which may, consequently, add another level of stress as both of you work to bring your vision to reality. Both of you may have totally different opinions on your real estate investing goals.
“Mutually Agreed” is also stressed because neither one of you will want to feel like the other is calling all the shots and that the other has no voice.
This will do nothing but cause more rifts in your relationship.
Having your significant other as your business partner is an extremely delicate situation and if both of you have the grit and determination to reach the desired outcome, you’ll make it through.
“But Austin, my husband or boyfriend doesn’t yet see the benefits of investing although I want him to be my business partner. How can I convince him?” I have two answers.
The funny answer: You can’t change ’em and you must find a new husband or boyfriend.
The truthful answer: You might not be able to convince him at that specific time and that’s ok. Like any other successful person would tell you, just because one doesn’t share the same vision, doesn’t mean you have to give up on yours. Take it as an opportunity to show and prove! When someone sees you reaping the benefits, they may be more inclined to join after seeing your success.
After you and your significant other decide on your MUTUALLY AGREED plan, it’s time to identify what both of you are great at!
Identifying what both of you are great at
“Success is achieved by developing our strengths, not by eliminating our weaknesses.” – Marilyn vos Savant
Are there any clear differences regarding the skill sets both of you have? Both of you may have organizational skills, real estate skills, financial skills, and a solid network, but is there anything that sticks out that one partner is significantly better at? (Please don’t say the bedroom).
In my case, I’m great at structuring deals and closing deals – that’s my thing. My girlfriend, Aja (pronounced “Asia”), is not out doing deals left in right. In fact, she doesn’t even work in real estate full time to begin with. She is in a completely separate industry so she understands that finding, structuring, and closing deals isn’t her strong suit.
I, on the other hand, am completely terrible with paperwork, systems, operations, and efficiency.
Aja completes the whole list of extremely crucial skills that I lack. She is the epitome of being detailed orient, operational, and she doesn’t let her emotions get in the way of her business decisions.
Understanding what both of you are good at is NOT to be confused with your responsibilities. BOTH of you may financially complete the transaction, BOTH of you may maintain the property, BOTH of you may handle tenant issues, BOTH of you have access to the account, BOTH of you can handle a good portion of the things that come with managing properties.
Our partnership is harmonious and we will continue to get better working as a team through the ups and downs.
Find out what you two are undeniably GREAT at and use that to your advantage.
Investing with a Business Partner
“I firmly believe that success lies in the combination of both talent and business savy, and that the magic comes through the partnership between both.” – Delphine Arnault
This is a much different partnership. In this case, if your partner were to follow you home, say hello to the kids and start getting dinner ready, you might raise your eyebrow higher than the People’s champ, The Rock.
You might even tell them to “Know your role, and shut your mouth!” (Ah the good ol’ days of wrestling when I was genuinely concerned about the health of the individual who was just slammed through two tables).
You may have found your business partner through a networking group, a referred friend, or your own sphere of influence. However you attracted that partner, you’ll want to make sure your partnership is just as harmonious. Find out what both of you are great at and use that to provide some structure within your partnership. It’s obviously easy to identify the strengths of partners when one is a real estate agent and the other is a contractor. However, it can be tougher to determine the strengths of a partnership between two real estate investors or four real estate agents or three best friends from college who all studied business. If this is the case, instead of trying to find strong suits, split up the responsibilities in regards to the departments of your business. For example, if you’re a fix and flip team, one partner might be in charge of acquisitions/deal flow, the other might manage the rehab projects, and the other can handle the sale of the property. In the beginning, it may take a few deals to find out what department each partner excels in the most, but at least you will develop a solid foundation of teamwork.
One word of advice when forming a partnership or developing a team. Be sure that at LEAST one of you is extremely knowledgeable in the field of real estate investing. You don’t want to be in a situation where the blind is leading the blind. Find someone who has experience getting deals done – that will drastically accelerate your learning curve. You might not have money, but if you have the knowledge and hustle to find deals, locate someone who has the money and more importantly, the experience of getting deals done.
All that to say….
Partnerships can open more doors than one person working in solitary and you know what they say “two minds are better than one.” It helps you keep your motivation alive when you have someone working with you towards the same goals.
No, you don’t need to have everything in place first before you take action, just take the first step. The areas you lack, someone else will have in abundance.
You live in a world full of opportunities and it’s never the lack of resources that cause someone’s failures; it’s the lack of resourcefulness.
Are you part of a partnership? What have your experiences been like? Comment below!