All Topics / Help Needed! / Partnership or alone?

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  • Profile photo of Monahan_2Monahan_2
    Join Date: 2004
    Post Count: 18


    A good mate and I have been speaking and thinking about property investing for a while now – BUT haven’t done anything yet…

    We have a dilemma: Should we start investing together as a partnership, or should we work/research together, but invest separately?

    We think we’ll do better working as a partnership, BUT are worried that either or our situations may change in the near future which might lead to some messy reorganisation of our (hopeful) portfolio.

    Any tips would be great.

    Profile photo of TerrywTerryw
    Join Date: 2001
    Post Count: 16,213

    It is not really a good idea to go for loans jointly. This is because you will be be repsonisble for the whole debt. Therefore when going for future loans, lenders will assess you on the whole debt, but only your share of the income (ie half the rent).

    So if going into a partnership, look at doing it so that you avoid both being responsible for the loan.

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    Profile photo of geogeo
    Join Date: 2003
    Post Count: 1,194

    A partnership is good only if you have a sufficient partnership agreement in place.


    I’ve found a way to help you save and earn whilst not selling or delivering any product. If interested, drop me an email or PM me to find out how

    Profile photo of Chris100Chris100
    Join Date: 2004
    Post Count: 22

    If you join forces?…Document everything!!! That way there can be no arguments later.
    I’d suggest you look at entering into this as “tenants in common” with shares agreed (see your conveyancer about this).
    If its a reactive investment then you will most likley not need extensive agreements in place (you can also go Joint Venture where each is repsonsible for their own costs and other responsibiliites).
    Going on your own but sharing ideas can result in some pretty interesting competition between you, but shared experiences.

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    Profile photo of Mortgage HunterMortgage Hunter
    Join Date: 2003
    Post Count: 3,781

    Do you need to go into partnership to get started?

    Do you think you will achieve substantial synergy by going into partnership?

    What are the reaons to do so?

    Unless it is imperative then I would avoid it. In my experience with my own ventures, friends and clients I would counsel against it.

    By all means work together and help each other along the way – but I personally would prefer to keep the purchases seperate.

    The only time I would consider it is for a short term project with a clearly defined exit strategy and time frame. Something like a build and sell. Perhaps a duplex where you each walk away with one? Just a vague suggestion to get you thinking.

    Cheers and have a super Christmas.

    Simon Macks
    Mortgage Broker
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    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of waprincesswaprincess
    Join Date: 2004
    Post Count: 29

    I agree with the others – everything in write – communicate effectively and all the time – dealings with family and friend is tricky at best


    Profile photo of Supa FreakSupa Freak
    Join Date: 2004
    Post Count: 101

    Do your own thing and support each other as much as you can.

    We have a group also that was considering throwing our lot in together…but we are now glad we invested using seperate entities as some want to develop, some want to renovate and we are wrapping…

    Profile photo of Monahan_2Monahan_2
    Join Date: 2004
    Post Count: 18

    Thanks for the tips everyone.

    Still not 100% sure what we’ll do, but will consider all the advice!

    Profile photo of Kiwi-FullaKiwi-Fulla
    Join Date: 2002
    Post Count: 371

    Yip … absolute clarity in a JV agreement is a must and must over all the what ifs. also make sure a declaration is signed showing all paperwork has been explained by an independant solicitor so that there are no coersion ground later if it worst case scenario went to litigation.
    cover your Butt…. and no-one gets it blown off when the bullets start flying :o)

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