“Partnerships in property: What do you think about taking a three or four-way share in residential real estate?”

No problem at all – so long as all partners promise never to change any of their personal circumstances. Ever.

Nobody is to get married, divorced, have any more children, lose their jobs, or die. They’re not allowed to develop gambling addictions, poor tickers, a life-threatening illness, or a thing for the cute nanny/gym instructor.

They have to promise to be your friend forever, to love your partner (without wanting to jump them, obviously). And they definitely can’t go bankrupt. That’s a starting list.

Residential property is expensive and requires long-term commitments. The more partners in a property purchase, the more likely that an “unforeseen event” will force a sale.

And Murphy’s Law says that if one of partner’s misfortunes impacts on the syndicate, then the timing is likely to be even more crap for you, such as when your own business/household cashflow is struggling.

Any time you team up with others for investments (including family), get a legal agreement to cover the “what if” scenarios where a change of ownership is unavoidable.

What’s the exit strategy? Do the other partners get first option? How is the property valued? How are renovations funded?

And insist on everyone having reasonable personal risk insurance to further minimise an event causing distress.

Consider as few partners as possible. Avoid completely if one of your potential partners has the fidelity characteristics of, say, Wayne Carey.

Bruce Brammall is the author of Debt Man Walking (www.debtman.com.au) and a licensed financial adviser.