What's a fair split for partners in a real estate investment?

[thefed]

Just curious what YOU would come up with. I'm in this situationa nd would like to compare my results vs popular opinion.

The POLL cut off my explanation.. Person A also provides 70% of the workmanship (knowledge base). Person B provides 1/2 labor, and will reside in the home paying the mort/PITI for 12 months (just enough to break even) He will be saving 200/month vs his old apartment.

FYI, the home should yield between a 15 and 25k profit. It is expected that each person will put 250 hours into the home.

[youbet]

All the profit will go to the lawyers. This will never work. Doctors and hospitals might wind up with a share too.

[eridanus]

Person A gets their investment back + max(T-bill/S&P/RUT return) for the period. Or maybe take an average of those indices.

Person A gets all depreciation for the tools.

I'm unclear about what the "70% of the workmans" means. Is that workman's comp insurance?

Then split remaining profit by work done. If both partners work 50%, split the rest in half.

[Arif]

From the way you make it sound (although a bit confusing) Person A will provide 100% of the capital and do half the repairs. Person B will do the other half of repairs and live there. I wouldn't even offer to split the profits. He isn't doing anything other than half the labor. Figure what it would cost you to hire a contractor and base his compensation off of that. You Person A is taking on a significant risk in investment over Person B who can just walk away if it doesn't work.

[newyorklady]

No idea, but I can guarantee you that both A and B will feel they got the raw end of the deal.

[newyorklady]

yeah, why not just hire a contactor and rent it out for a year? a situation like this one is begging for trouble.