Whether it’s your first deal or you’re just looking at accelerating your investment portfolio, finding a partner can have lots of benefits. Sure, there are drawbacks to partnerships too, but we won’t focus on those here. Instead, we’re going to focus on the best places to find partners for long term success in real estate investing.
The first place you should look when getting into real estate is your own network. This is by far the best place to find partners. Start by making a list of 5-10 potential people in your network that you think MIGHT have some interest in real estate investing.
This first group of people is going to be made up of family and friends. That is okay! These are the people that you have relationships with and they can be great resources for you.
What do you say? We get this question all the time. Here is a template that we share with our students.
“Hey {{Partner Name}}, My name is Dallas, I got your number from {{Referred By}}.
I’m a real estate investor. I work with people like you to find high cash-flowing properties and help you invest in them 100% passively. People love real estate because it’s a physical asset that people will always need, it gives you a paycheck every single month, you get sweet tax benefits, and we get the long term wins as the property goes up in value.
Obviously I don’t expect you to be on board right away. I’m mostly just checking to see if you’re open to talking more about this.
Could I send you a website to check out to get a little more info?”
Obviously, this changes a little bit when you’re sending the message to someone you’re close to, but this is the general idea. Your first interaction is just to gauge interest and see if it’s worth pursuing another, more in depth, conversation.
I bought my first real estate investment property back in 2018. I had literally gotten married two weeks before we closed on the property. We had about $30k saved up from my summer job in college, but that wasn’t really enough for what we wanted to do. So, I reached out to my network to find a partner. I ended up partnering with my parents on a deal.
My parents had a little bit of cash on hand and a ton of money in the stock market. I explained to them the benefits of real estate investing (the tax benefits were especially enticing) and that they needed to diversify their investments. They decided I sounded like I knew what I was talking about and they bought into the need to invest in real estate. We split the deal 50-50. I brought them the deal, managed it, and put about $30k into the rehab cost for the duplex we bought. They brought the credit and cash to close on the property. They ended up in the first year about $90k cash out of pocket.
Now, my parents’ investment strategy was VERY different from mine. In fact, our partnership only lasted a year and a half before we parted ways. They cashed me out of my investment and I went and bought a 4-plex. They still own the duplex and they currently are letting my siblings live there super cheap.
The partnership wasn’t perfect, but it got me in the real estate game and was a critical stepping stone to where I am now.
Now, if you have conversations with your family and friends and none of them are interested in investing in real estate, the next step is to reach out to friends of friends or friends of family members. In your conversations with your family and friends, if they tell you know you should ask them if they know anyone that might be interested in partnering on a real estate deal, or that even has any interest in real estate. If they tell you yes get their contact info and have a conversation with them.
If they tell you they don’t know anyone that is okay, but you’ll want to follow up with them every few months to check if they’ve changed their mind or, more likely, if they’ve had a conversation with anyone about real estate who could be a potential partner.
Those are the ideal and easiest places to find a partner: family, friends, and friends of friends. After you exhaust those avenues there are a couple other places to look, but they take more work.
The first thing you should do is to get active on social media. Facebook has a ton of real estate investing groups (we have one at Six-Figure Landlord!). Join these groups, and BE AN ACTIVE MEMBER.
What does it mean to be an active member? Post, comment, like others posts. When we say a post, it’s not just a one time hello and “I’m looking for partners” you should actively seek to add value to others. Answer questions, welcome new members to the page, post about some deals you’re looking at.
As you consistently add value people will take notice and it paves the way for conversations about partnerships. We’ve found that Facebook and LinkedIn are the best places for these groups.
While you work on building your presence on social media you should also work on establishing an in person network. Most places will have regular real estate investor meetups. The easiest place to begin is to go to your local REIA group and start having conversations.
Again, the first goal here is to add value. If you can add value to others the law of reciprocation is enacted and they will want to add value to you. This is also a good place to go to learn the basics of real estate investing, although they’re typically a little hit or miss in terms of content. Go primarily for networking opportunities.
The last strategy we recommend for establishing partnerships is to ask your professional team for references and introductions. You want to be the most careful with this one because you can burn bridges and break the trust of your team members if they feel like you are just using them for their connections.
You need to genuinely seek to add value to them consistently before they will give you the names of investors and others in their network, but once you gain that trust, this is where some of the best references and introductions will come from. It just takes more time to build these relationships to the point where you’ll start seeing the payoff.
Now, here is a critical message about partners. While you’re looking for a partner YOU need to get your personal finances in order. You need to act AS IF you will never find a partner and you will need to move on your own. There are two reasons for this.
First, maybe you won’t find a partner, or maybe it takes you a few years of networking to find a partner that you actually feel comfortable partnering with. You shouldn’t wait that whole time to get started in real estate. Act like you won’t find a partner and start getting your finances in order to make the move by yourself. Partners should ACCELERATE your timeline, they should NOT be the timeline.
Second, let’s be real. If you can’t manage YOUR money, you’ll be hard pressed to convince others to let you manage their money. I know I just said it, but I’ll say it again: partnerships are meant to ACCELERATE your investment strategy, they are NOT an investment strategy.
You should be doing these things simultaneously, work on getting your finances in order AND get out and network to build relationships to find potential partners. I used a partnership to accelerate my real estate investing strategy by a couple years and you can too, but you need to put in the work.
Your real estate coaches,
Dallas & Greg
