Question:

Myself and my friend (Muhammad) invested in a house @ approx. 30:70 ratio
30% myself and 70%  Muhammad
(ratio is not accurate, rounded off for understanding)

Intention

Our Intention was to invest and gain profit.
1. either by keeping the house for couple of years and then selling it to gain profit
2. or give the house on Rent and gain profit from the rent until decided to sell. and divide the rent among us based on % of investment.
     a. Either give it on rent to someone and share the rent based on % of amount invested
     b. Or my friend Muhammad move in that house and pay the % of rent to me based on my % of investment.

Question

In case of condition mentioned in 2.b. i.e. (my friend Muhammad move in that house and pay the % of rent to me based on my % of investment.)

Q1. is it permissible to take rent from Muhammad?
Q2. Does the % amount of rent paid to me by Muhammad falls under any category/class of Riba (interest)

Answer:

Bismillahi Ta'ala

Assalamu alaikum warahmatullahi wabrakatuh,

If two partners own a property then it is permissible for one partner to rent out his share of the property to the other partner. Hence you may rent your portion (30%) to Muhammad for a stipulated rental.

The rental will not be considered as Riba'. On a technical level, Muhammad will be benefitting from his own share as an owner, while at the same time benefitting from your portion of the property as a tenant. 

And Allah Ta'ala Knows best,

Wassalamu `alaykum, 
 
Mufti Faisal al-Mahmudi

درر الحكام في شرح مجلة الأحكام (1/ 465)
وَإِنَّمَا أُجِيزَتْ إجَارَةُ الْحِصَّةِ الشَّائِعَةِ لِلشَّرِيكِ؛ لِأَنَّ اسْتِيفَاءَ مَنْفَعَتِهَا مَقْدُورٌ؛ لِأَنَّ الْمَالَ بَعْضُهُ لِلشَّرِيكِ الْمُؤَجِّرِ وَبَعْضُهُ لِلشَّرِيكِ الْمُسْتَأْجِرِ فَبِانْتِفَاعِ الْمُسْتَأْجِرِ بِحِصَّةِ شَرِيكِهِ بِالْإِجَارَةِ وَحِصَّتِهِ بِالْمِلْكِ قَدْ تَمَّ لَهُ الِانْتِفَاعُ بِالْمَأْجُورِ وَاسْتَوْفَى الْمَنْفَعَةَ الَّتِي قَصَدَهَا مِنْ الْعَيْنِ الْمَأْجُورَةِ لَهُ؛ إذْ لَا اعْتِبَارَ لِاخْتِلَافِ السَّبَبِ عِنْدَ اتِّخَاذِ الْحَاجَةِ وَكَذَلِكَ لَوْ كَانَ مَالٌ مُشْتَرَكًا بَيْنَ ثَلَاثَةٍ أَثْلَاثًا فَكَمَا لَا يَحِقُّ لِأَحَدِهِمْ أَنْ يُؤَجِّرَهُ مِنْ أَجْنَبِيٍّ لَا يَحِقُّ لَهُ أَنْ يُؤَجِّرَهُ مِنْ أَحَدِ الشَّرِيكَيْنِ الْآخَرَيْنِ وَلَكِنْ إذَا أَجَرَهُ مِنْ الِاثْنَيْنِ مَعًا؛ صَحَّتْ الْإِجَارَةُ.