The advent of Virtual Reality (VR) technologies has begun a shift in communication between people and their interaction with 3D virtual environments. VR has great potential to provide high immersion to users, allowing designers to create vivid and impossible interactions. However, while software and technology play a crucial role in creating a VR experience, as designers we must understand how humans perceive these elements of sensory illusions in order to create experiences that are appropriately received and interpreted. Recent efforts in “Social Virtual Reality” explore shared experiences and collaboration between users through remote interactions in virtual environments. One emerging concept is “Virtual Co-embodiment”, enabling two users to share a virtual character. This interaction fosters a unique multiplayer experience, promoting social co-ordination and collaborative user experiences. Co-embodiment achieves heightened levels of co-presence while still preserving a strong sense of agency and body ownership for both the users. The influence of feedback mechanisms on these factors is an important point of interest. This project expands on this idea of co-embodiment by investigating how haptic feedback affects these factors between dyads performing shared perceptual activities. To examine these effects, an experiment was designed wherein pairs of participants in co-embodiment, performed reaching tasks with varying levels of control over the shared hand avatar, both with and without haptic feedback conditions. This was facilitated using a VR system that was tailor-made to meet these requirements. Objective measurements of their motion were collected during the interaction and subjective responses were recorded post-interaction. The results showed that participants sense of agency was significantly lower in conditions where they received haptic feedback when their hand positions overlapped, compared to conditions where there was no haptic feedback. Participants made negative associations of the haptic feedback during the experiment as expressed in the post-experiment interviews, which could have affected their perceptions of agency. They also show significantly greater sense of agency during tasks where they shared a common target with their partner, while co-presence and embodiment levels were significantly higher in tasks where there were multiple targets. Participants also spontaneously adopted leader and follower roles during the interactions with different motion strategies to gain control over the shared avatar. These, along with other findings of the qualitative and quantitative analysis are compiled to extract insights to inform future research of this concept. Additionally, limitations of the study are discussed along with recommendations for further improvements to enhance this paradigm.