How good is your relationship with your brother? That is vital in this kind of thing.
My brother and I partnered on flips in 2017 and have done ~12 homes together. We didn't start out with anything more than a verbal agreement.
He is a real estate agent, but we got the deals through his friend who mentored us. Initially we did equal portions of work and capital, and we split profits 50/50. I'm not nearly as handy as my brother, but my wife is.
As time went on we learned (quickly) that doing all the work ourselves really sucks, so we hired more things out and accepted a lower profit (really though, if we'd paid ourselves hourly it would be a higher profit).
Eventually my brother quit his day job and did flips as well as a couple of other businesses full-time (I mentioned he's an RA, he's also a professional photographer, and started an RV rental company).
This allowed him a little more time than my wife and I had, and being more handy he spent more time at the houses working on them.
My wife and I fell into the role of providing capital and hiring/managing subs. There was overlap, but because he was now living on the profits he wasn't able to reinvest as much. We didn't touch the profits but funneled them back into flipping.
He grew tired of working so hard and feeling like he was getting a smaller cut, so we decided with him that he would get a base wage for hours spent working on the homes. Something like $30/hour. Might have been $20, I can't remember.
There have been tense times, and it has strained our relationship. We've also made an absolute killing on some of them and celebrated at $100/plate restaurants (Ruth's Chris Steakhouse ftw).
We did finally create LLCs, but our lawyer sucked and so we didn't really do much with them. We've done 1099s, etc. to make sure we're squared away for taxes. We _do_ have an accountant (CPA).
Right now we're not doing a flip together for the first time in a while. We each did one separately this last fall and those worked out well. We will likely work together on more as we get them. Utah's market is insane though so it's pretty slim pickings for flips that we want to take on.
The bottom line is this. If you have a good, mutually respectful and loving relationship with your brother, it'll work out. There were times when things were stressful. We had to lend them sometimes upwards of $10,000 to help them make ends meet after he quit because he didn't have savings and isn't great with his money. He always paid us back, but if he hadn't we wouldn't have cried ourselves to sleep at night, money comes and money goes. Family is important.
Both parties must realize two things: Business is business, and family is family. Don't let business decisions affect your relationship--sometimes you're going to have to decide to do something that will be taken hard, most often it's conversations that must be had that could be offensive. And if there's a chance that a business decision will ruin your relationship, don't do it. I recommend a lot of prayer as you decide how to proceed with every aspect and ever decision.
Sometimes the outcome won't be perfectly fair. You have to be willing to take hits sometimes. You will lose money sometimes and if you can't forgive and try again, it won't work out.
With the money we made from this arrangement we were able to build a new construction home for $300,000, 2000 sq ft finished (5 bed 3 bath) then use a good chunk of that money to finish the basement as an ADU, making our home a 3500 sq ft 8 bed 5 bath, 2 full kitchens, 2 laundry home. We charge about $1400/month for the rental with no utilities because it's hard to separate who is using what. But that makes our portion of mortgage and utilities roughly $600-800, depending. After we refi we can expect our portion of the mortgage to drop to $0, and just pay utilities, because based on comps our home is already worth close to $500k. (Again, Utah's housing market.)
TL;DR: If you have a good relationship and both are willing to take hits and roll with the punches without getting offended and hating on each other, it can work out and the profits and gains can be incredibly good. But you must both be willing to work on it and through it. The hardest part of a familial business partnership is the family aspect. But it can also make the business work where it might not have.
