What is typical profit split in this market between capital and sweat equity for property flipping?


#1

We are attempting to structure a deal with another partner where we are contributing the capital and finding the deals and the partner does design/project management/rehab. Wondering what the typical split is in this market, or if investors are even offering deals to partners who don’t contribute equity. Thanks.


#2

Sara,

It has been fairly typical to split net profits 50/50 between the money partner and the sweat equity partner. I’m not aware of a “typical” split between partners where on is providing both capital & sweat equity and the other just sweat equity. I would imagine determining what is fair would need to be decided on a case by case basis since rehab can vary greatly between properties.