I was curious if anyone has worked with you family to buy investment properties by pulling resources? I have a brother who's a contractor, I'm a real estate agent, and then we have five other siblings (accountant, social worker, etc.) who don't want to do anything active in real estate investing but might share their money based on what we told them for expected returns.
The reason I ask, is maybe some of you have done this, have had lots of arguments or has gone well. Was curious to ask. Also curious what legal, family trust, type of logistics you've used.
Hopefully, your investment with family members will be smooth and there will be no issues.
Nonetheless, I recommend creating an operating agreement for this endeavor. Having everything on paper up front can save a tremendous amount of pain down the line.
Yes, my brother and I purchased a duplex together. We haven't had any issues, but highly suggest setting clear benchmarks/goals throughout each step of the investment process so it's clear and everyone is on board. Complete some basic financials, and have a detailed budget to work from. Also, put something in writing so you can defer to it versus trying to handle emotional conversations with family.
I've had a lifelong partnership with my sister, but it does not work for everyone. As @Danielle Jackson said, you have to set clear roles and strategies and know who is doing what. I would not want to involve the passive family members at all, that always goes sour because they don't understand when you missed a foundation issue and now the spread is 25k less.
Thank you all! That's a great word on having it formally in writing before beginning. @Jonathan Greene , great point! I think just knowing my family, I agree, and would work with my brother or someone who's going to be active investor but maybe not worth it with some of my siblings. A great perspective you shared.
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