Risk management is the process of identifying, assessing, and mitigating potential threats to a real estate investment, including financial, legal, and physical risks.
In co-ownership, risk management covers everything from adequate insurance and reserve funding to legal structure and owner vetting. A well-managed co-ownership arrangement anticipates problems before they happen — setting clear rules for disputes, maintaining proper coverage, and keeping the property in excellent condition. Poor risk management is one of the main reasons informal co-ownership arrangements fall apart.
GoForth, a luxury co-ownership company, takes a comprehensive approach to risk management for every property. Each home is held in an LLC that limits individual liability, comprehensive insurance is maintained, and reserve funds cover unexpected repairs. GoForth also vets all prospective owner families and provides a detailed operating agreement, reducing interpersonal and financial risks for all four co-owners.