Should I use partners to invest in a property or invest on my own

[David Rocca]

Hello BP, I am a new member also a new to the real estate game. I love the forum section of this site because of all the members help. I currently own a single family house in south Florida that I live in. My goal is to start investing into single family homes and multi unit properties. I want to try to buy 1 or maybe 2 per year.

The question I have is, I have two other investor friends that want to do this with me, but I'm hesitant. Partly because I want to grow this on my own and build passive income quickly. I feel like it I have two partners the return would be way less. On the other hand we can invest in more properties and increase cash flow with all of us. 

What should I do? Has anyone else been in the type of situation? Is two partners too much? 

Thanks for the feed back! 

[Hattie Dizmond]

Nick...this is another question where the answer is as personal as the type of underwear you prefer. ;-)  Consider forming a partnership like a marriage. Are these people you can stand to deal with in good times and bad? There will be conflict, but are you guys able to deal with it in a healthy way?  Do you have similar core values...meaning, do you make tough decisions using the same moral compasses?  I could go on, but I think you get the point.  

I have a partner. It's my sister. She is also my best friend. We definitely don't always agree, but we respect each other and approach those disagreements from a logical, non-emotional point of view.  We decided up front, and wrote it into our operating agreement  (Yes, I have a formal 15 page operating agreement with my sister.) that all decisions must be unanimous. We deal with differences of opinion, but when either of us has a real doubt, we just don't do it.  We trust each other to handle our own parts, and we clearly define those parts, so we don't step on each other. We also keep the other looped into what's happening with our part, in case one of us has to fill in for the other.  Basically, we operate as though we were working together.  ;-)  the difference is, in my 9 to 5 job, my personal reputation is not on the line, when my coworkers make decisions and do things. When my sister and I speak or act, the other's reputation is at risk as well as our own.  She is one of the only people I have that much confidence in. 

I would advise you to consider these things as you contemplate what makes sense for you personally. The math is the easy part!!