How to raise money and own property as a group
Some friends and I are probably going the LLC route in buying property together. Thanks for all the resources you have shared online!! Would you be willing to share the bylaws/ownership agreement that you all use, to save me some time in writing up drafts etc? We plan to come up with our own guidelines and then bring that to a lawyer to make it official. I'm also curious if you see any way to get around the tax redundancy of paying yourself? We are thinking of calculating rents the way you all do, but then cancelling out what owner-residents would receive back, and then letting everyone pay based on what they actually would have to once all is divided out. Is that tax evasive? Does that make sense?
Wonderful! Might ya'll be willing to share your LLC documents and bylaws etc as a template (perhaps with private info redacted?)? Or could recommend preexisting templates?
thankyou for this super helpful overview! im curious to hear more about how you differentiate the rights and responsibilities of owners vs residents. obviously there are some costs and decisions that are clearly in the owners category (like, "when should we sell?") buy there are others that seem to fall in a grey area, particularly those that are 'semi-permanent' or 'non-essential infrastructure'... like planting a fruit tree? a permanent spa? a ride on lawn mover? who pays for it and who does the work of installing it or caring for it? we are trying to work this out in anticipation of starting up our 'homestead' style co-living project soon (in Australia) where we'll have lots of these grey area garden-related items to work out!
This is super helpful, thanks. Does inflation or appreciation have any impact on setting the rents (eg do they increase over time?)? Thanks!
Who sets the rents? Is adopting the rent roster just part of adopting the budget?
How is each investor's exit price determined? Or to say it another way, how were the Year 5 Appreciation figures calculated in the example.
Have you written somewhere about how you got your mortgage? Your property is more house-shaped than the ones I pursued, but even as I slowly approached house-ness I still had to talk to hundreds of banks before I found a single opportunity to get a loan. This was for me individually, with enough income to cover the loan. If it was easier for your LLC, I'd love to know that.
phil this is such a good explanation u have detailed.
Once again so proud of u!
Love from TN