#1
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buying an apartment building with friends
I'm graduating soon and several of my friends are too. We are all looking for a place to live and have a reasonable income (100kish a year).
We have worked on projects together in the past and are unlikely to have money related problems. I'm aware that this is a really vague question, but ask for any details you want and I can provide them. I'm wondering if it would be a good idea to buy a 5 or 6 apartment building (we would probably live in different apartments) and rent off the rest. What are the draw backs to this? Is this a good approach to investing some of our money? |
#2
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Re: buying an apartment building with friends
yeah doesn't sound like a bad idea given your situation.
As long as you get along together cuz I personally rarely partner up with other people for real estate deals. Where do you live exactly and how is the real estate market over there? |
#3
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Re: buying an apartment building with friends
When I graduate I'll be in DC. I'm willing to go to a wide range of places though (and so are they).
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#4
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Re: buying an apartment building with friends
what are youdying to leave college earning 100k? thanks
if you genuinely get along now it might work out. When you go out to eat together and the bill comes, what happens? |
#5
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Re: buying an apartment building with friends
[ QUOTE ]
what are you studying to leave college earning 100k? thanks [/ QUOTE ] Theoretical mathematics, Applied physics. I plan on going back to school eventually. [ QUOTE ] if you genuinely get along now it might work out. When you go out to eat together and the bill comes, what happens? [/ QUOTE ] everybody pays for what they got. but if somebody doesn't have cash or something nobody really cares about covering them. |
#6
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Re: buying an apartment building with friends
I would be really hesitant. Investing in real estate with friends for the long term can get hairy. Throw in multiple friends in a dynamic period in your lives in a wacky real estate market, and I think you are setting yourself up to have some problems.
If you do this, make sure all the "what if's" are properly spelled out on paper. |
#7
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Re: buying an apartment building with friends
Buying real estate with friend is almost always a bad idea. It might seem like a good idea now, but you guys are all still young and don't know where you are going to be even 2 years from now. Someone is going to want to sell their portion within the next 2-3 years at the most, and then what are you going to do? There will be a fight over how to cover that person's share, or to try to get everyone to just sell the building outright. Not everyone will want to pitch in more money out of pocket to buy that person's share because by then they might be married/have kids on the way and need that moeny for something else even though right now in theory everyone could pitch in to buy someone else out. That is only one scenario of many as to what could go wrong.
Also, real estate does not out-perform the stock market. You would be better off putting your money in NTDOY and let it double over the next year than buying some apartment building. |
#8
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Re: buying an apartment building with friends
Friends + money = bad.
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#9
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Re: buying an apartment building with friends
You may be able to structure the partnership so that each share can be sold. You may also be able to spell out the work responsibilities so that if someone fails to live up to their responsibilites, it can be handled with a minimum of hassle.
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#10
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Re: buying an apartment building with friends
i agree with most of the above posts saying that friends + money = bad.
BUT, if you still wanna do it, make sure you set up an LLC and do it through that. it will make your life sooooooo much easier down the road, when it comes to selling the asset / distributing gains/losses etc. |
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