More Than Ever, people need to explore creative ways to fund their property flipping renovation. Now I don’t mean the average home renovation; I mean when you want to renovate professionally, flip property!
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Hey guys, Naomi here from the Rapid Renovation Formula!
So, you want to jump into the renovating game, but you don’t think you have enough borrowing power.
You are looking to renovate for wealth, but you’re not sure you have enough time to be hands-on.
Are you trying to find a way to reduce your monetary risk before you even start renovating?
Australia has some of the major cities worldwide that are becoming more and more expensive to live in. Properties are going CRAZY like places in Sydney. If you want to renovate a 3-bedroom home for a young family to make it a solid strategy, the price point might be that little bit outside of what you want to do, which can sometimes make realizing this dream of renovating feel like a bit of a stretch for you.
And coming up with such a huge deposit and in the stamp duty etc… IT CAN FEEL SO PAINFUL!!!
Well, lucky for you!
It has nothing to do with getting into crazy debt to start renovating for wealth, even the bank won’t lend you the money, or you don’t want to throw all your savings into this renovation project.
The solution is partnering or joint venturing.
So what is this?
To put it simply, a joint venture or partnering relationship is a business relationship between you and someone else.
It can be you and one other person or more, where you agree to pull together your resources to achieve your specific goal.
SO, if you have your eye on that three-bedroom suitable for renovating, you don’t have enough sitting in your savings account or enough serviceability for a loan.
A joint venture or a partnering opportunity will give you that chance to acquire and renovate that house TOGETHER, with someone else who also wants to be renovating to create wealth.
So, you’re both going to be in the project together, with the same end goal to make a good profit!
Right? Sounds simple, right?
Well, it can be simple as long as you DO IT CORRECTLY.
Joint ventures are such a great way to get into renovating business, and they can be a great way to reduce your financial stress of the entire exercise!
But, to enjoy the benefits of an excellent joint venture, there are certain things you need to keep in mind!
#Step 1-Make It Legal
Before you start shaking hands and making agreements over a beer or wine, it needs to be IN WRITING.
I know it feels wired to have a legal arrangement with your best friends or someone else that you super close to.
However, Renovate a house is a long-term agreement. Time flies, things will change. There are so many possibilities in the future that might change your circumstances.
To have the formal joint venture agreement and partner, you need to have it set up correctly. That is when your rock-solid legal document comes into play! This baby will save you so much hassle.
Necessary paperwork before you jump into a partnering agreement or a joint venture of any kind is essential.
#Step 2-To Know All Of Your Strategy For Your Renovation
Now, I’m not talking about your renovating strategy. I’m saying this is what you’re looking for out of this joint venture. Although it’s still handy to reassess and tweak your property strategy as you go along and maybe suit your joint venture, the plan is all about you and the partner you’re working with.
Are you ok with being joined-at-the-hip forever? If not, then you probably wouldn’t look at a buy-and-hold.
Are you both looking to use some additional cash that you have lying around or some other higher serviceability you have for the next 12 months to get in some renovate properties and sell them on and move out?
Are you looking to work together to offset some capital losses that you may have in a company or a trust?
So, this is on top of your renovation strategy. This is a strategy for you and your partner with all the joint ventures you’re working with.
#Step 3-The Capital & The Borrowing Power
The third point is all about MONEY. In particular, how much money you can access to contribute to the renovation project.
Do you have some healthy savings that you want to inject into the renovation fund?
Do you know how much the bank or a private lender is willing to borrow you?
Have you got enough leftover from that than to live?
So, if you don’t have enough money to put down for a deposit or stamp duty of the renovation costs, you’ll want to be teaming up with someone who will make up the gap.
#Step 4-Time And Skill for Renovation
Joint ventures aren’t just about finding someone who has the capital to help you secure a renovation project.
You might have the money to jump into renovating, but you don’t have the time.
On the other hand, you might have the time, but you don’t have the confidence in all the skills needed for renovating. That’s why finding a joint venture comes in handy.
The great thing about doing a joint venture with someone is to team up with people to create a renovating powerhouse. There’s always the added benefit of bouncing ideas of investment and commitment to the project with someone else.
So, as long as you have all of these things of who’s doing what in the nitty-gritty legal contract that I mentioned up in step one, you will be on the right path to having a satisfying and profitable joint venture.
On that one, Happy renovating!
Thanks for tuning in! If you loved what you saw in this post, I’ve popped a link to one of my latest posts HERE, where I go into more detail for you.
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