You would have to decide how to deal with version control workspaces and pending changes. For example, you could use a public workspace, but lose some trackability. Or you would use a single common metadata folder and you would have to remove the other developer's workspace and add your own. Pending changes wouldn't be allowed and you would destroy them in the process, if there were any.
A more complex, but much more flexible alternative would be creating a separate repository folder for each developer and let developers create workspaces in their own folders. You would also need symbolic links to standard packages.
So it's possible, but letting developers work on their own DEV VMs is usually better. It allows concurrent development, using setup and tools according to each developer's preference, using different versions of F&O (e.g. one developer testing a new application version while others work on an older one) and so on.