Purchasing investment property with a friend

That is correct. And purchasing with a friend is normally a terrible idea. If I were you I'd go to a lawyer and get a full coownership agreement drafted.

 

I have posted this several times but I don't necessarily buy into the whole "Don't buy with a friend or family". I purchsed with my brother and my wife and contributed 17k. I walked away with over 100k net profit in 3 years and an immense amount of development and renovation knowledge.

The rules just need to be very well laid out! Plan ahead and most importantly plan for an exit. I would strongly discourage to buy with anyone except your partner for a long term buy and hold.

A 3 year timeframe with value add the goal is where I see buying with others working best. It's a long enough period to do required works and if bought in a rising market, get the benefits of CG. It's also short enough to have a finish line so even if one party has their life changed (married, baby, change in finances.etc) then they should still be able to exit as planned or atleast close to.

 

The hassle part is not the loan or getting in, the hassle is getting out if partners do not agree.

At the same time, as Terry says, it may be better than doing nothing.