The Myth: Joint Ventures Can Run on Trust Without Legal Documentation
Running a property JV on a handshake is one of the most common causes of investor disputes. A well-drafted JV agreement protects both parties and is essential before any capital is deployed.
Joint Ventures between friends, family, or professional acquaintances are a powerful way to scale property investment. They are also a frequent source of costly legal disputes when the terms are never formally documented.
A proper JV agreement must define: each party's capital contribution and what happens if one party can't contribute their share mid-project; profit split and when distributions occur; decision-making authority (who signs off on contractor payments, price reductions on exit?); dispute resolution mechanism; and exit provisions if one party wants out before the project completes. Without this documentation, a verbal disagreement about a £5,000 contractor invoice can collapse an entire development project and a friendship simultaneously.