Looking to buy my first property with multiple investors

[Fisher Hudak]

I am a 20 year-old college student. Me and three of my friends are looking to buy an investment property. We are all first time home buyers. We each have about $6k to put down and we are looking for single family homes that we can rent out/put on Airbnb. What is the best way to move forward with this? Moreover, is it possible at all?

[Nicole Heasley Beitenman]

It's possible, but a few things to consider:

1. You NEED to have a contract written up and reviewed by an attorney. It needs to spell out EVERYTHING--what happens if someone wants out? What are the responsibilities of each partner? Where will funds be held and who will manage funds? How often are profits distributed? What kind of cushion does the account need to have before investors receive profits? What is the budget for property management, repairs and maintenance, vacancy, and capex?
2. If that $18k is every penny you have, have a plan for emergencies. What funds will you utilize if the hot water tank dies or a tree branch falls and puts a hole in the roof?
3. What are your criteria for a property? Because there's 3 of you, I recommend an agreed-upon checklist before you start looking at properties of must-haves and deal-breakers. That way, there's no hard feelings when two people love a property and the third doesn't. Keep emotions out of it.