What to charge when adding a partner - The HuntingPA.com Outdoor Community
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post #1 of 39 (permalink) Unread 03-01-2020, 11:27 PM Thread Starter
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What to charge when adding a partner

I have a cabin with some property and a friend that has been asking to become a partner in it. Hypothetically, letís say that the property just appraised for $100,000. What would an appropriate charge to become a 50% partner. When I had the appraisal done, the agent said that if I was selling it, that he would have listed it for a higher amount, hoping to get the $100,000. But bringing in a partner would be a cash transaction, with no realtor fees and no sales tax. So I was thinking it would probably be appropriate to do it at a discounted rate, I just wasnít sure how much. If anybody has done this how did you handle it? Thanks.
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post #2 of 39 (permalink) Unread 03-02-2020, 06:16 AM
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I would just say, "sorry not interested in a partner". Then you have absolutely nothing to worry about. That's what I did.
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post #3 of 39 (permalink) Unread 03-02-2020, 06:45 AM
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Having good partners can be fantastic. Having a partner can become a nightmare. Think over all the things that move could bring.
If you feel very strongly that you would like to keep control of major issues concerning the camp, sell less than 50%. If financially you can handle it yourself, my advice is to keep it.

I have dealt with absentee owners for 17 years. One absent when the bills are due. Not 1 minute of work from any of them. Not 1.00 from them for equipment, service of equipment or driveway maintenance. 1/4 mile driveway. I could go on and on.

Second thought, Keep it if you can and tell your buddy he can contribute all he wants and use it when he wants to. Perhaps break it down to a yearly payment you both can live with.

Consider if you have children, they will be owners someday with the partners heirs. Just one nightmare possibility. Good luck!
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post #4 of 39 (permalink) Unread 03-02-2020, 07:06 AM
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Don't do it.
Tunadawg has your best option.
Be nice, be friendly but maintain a PERIMETER. Sandbag your position if you must.
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post #5 of 39 (permalink) Unread 03-02-2020, 08:17 AM
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Avoid it at all costs!
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post #6 of 39 (permalink) Unread 03-02-2020, 08:37 AM
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agreed avoid it at all costs. Kip Feroce has some good points as well as the other posters. I have heard to many horror stories about co owned camps. not trying to bash your friend but stay away from a partnership. good luck on your decision.
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post #7 of 39 (permalink) Unread 03-02-2020, 08:37 AM
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Singularity, when it comes to money, property, assets, etc. is the ONLY way to go unless you are aging and want to move some of those assests to your children so the govt doesnt take them away from you and your family when you die.

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post #8 of 39 (permalink) Unread 03-02-2020, 12:10 PM
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Quote:
Originally Posted by pilotjjc3 View Post
I have a cabin with some property and a friend that has been asking to become a partner in it. Hypothetically, let’s say that the property just appraised for $100,000. What would an appropriate charge to become a 50% partner. When I had the appraisal done, the agent said that if I was selling it, that he would have listed it for a higher amount, hoping to get the $100,000. But bringing in a partner would be a cash transaction, with no realtor fees and no sales tax. So I was thinking it would probably be appropriate to do it at a discounted rate, I just wasn’t sure how much. If anybody has done this how did you handle it? Thanks.
50% of FMV would seem reasonable unless there's some associated intangibles such as having neighbors that allow you to hunt on their adjoining property or other types of unseen valuables unknown to realtor doing the appraisal. First & foremost.....KNOW YOUR PARTNER(which I think is obvious) before affixing his name to deed. Without knowing your financial condition it's sometimes financially advantageous to split ownership, risks & associated expenses. Best of luck!!

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Last edited by Loggy; 03-02-2020 at 12:16 PM.
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post #9 of 39 (permalink) Unread 03-02-2020, 12:31 PM
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Im with others on this one, Id avoid it if at all possible. If your buddy really wants to feel as though he is part of a camp you could always do a short term (yearly) lease to him. He can pay $X a year which should cover a portion of the taxes and yearly upkeep and allow him access to the camp whenever he wants. That way he can feel as though he is part of the camp, he can help contribute to the yearly costs and you retain all ownership and ultimately say of whatever goes on.

The only way it would make sense to include him as an owner is if you absolutely need the short term financial windfall you would get from this. If you do add him I wouldnt just do a 50% split of the property value. Assuming the realtor isnt taking in account the value of things that typically do not sell with a property...tools, tractors and so forth. If you have any of that and it would become partially owned by him Id come up with a market value and add that in. It can be a slippery slope but no way would i just throw that stuff in. Also, Id make it somehow that the camp is setup legally so that if this guys wife or future wife cant take you to the cleaners later and either force you to buy back (at probably a higher rate than todays value) or sell the camp so she gets her 50% worth if there was a divorce or even worse a loss of life to your new "partner"

Last edited by 171farm; 03-02-2020 at 12:33 PM.
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post #10 of 39 (permalink) Unread 03-02-2020, 12:43 PM
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Owning assets in a partnership is common & is in successful existence in virtually millions of arrangements. No reason on a small time basis as this that it cannot be advantageous. Impossible to discount such without knowing ANY surrounding facts by thinking of your own personal situation(s).

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