Buying a Residential Multifamily Property with Friends

[Kirby Elliott]

Hello! I've been a member of Bigger Pockets for a couple years but have been inactive for a while. I haven't done any deals yet but I plan to this summer/fall!  I live in Southside in Pittsburgh, PA. I'm wondering if anyone has had experience buying a property with friends and living with them. I've read a few articles and it seems possible - as long as you go to a real estate attorney and get a written agreement. Ideally we would live in one unit of a duplex/triplex/quad and rent out the others. I've rented with a few different roommates over the last few years so I'm at least comfortable with that. I know investing would be vastly different. Could anyone give some general advice on investing and living with friends and the pros/cons of this strategy? 

Thank you!

Kirby Elliott

[Mike McCarthy]

You need a good operating agreement and plan for what happens when one friend decides to move out and/or pull out. How is he paid back for his investment plus appreciation?

How do you handle when one friend wants to rent a unit quick for $800, but another wants to hold out another month or two for a $1000 renter?

Or the roof needs replacing, who pays for it?

It’s all doable, but you need to assume for the worst. Also - the whole doing business with friends can go the wrong way too. Keep it all in mind