Did you friend say anything to you in the dream?

If not, it could be repressed emotions manifesting themselves in your friends' silence and being a ghost, a shadow of his former self.

The seeing but not hearing represents all the things you wish you could have said to your friend.

Perhaps you could try and incubate a dream about your friend and see if you can strike up a conversation with him. By incubate, I mean focus on him before sleep and tell yourself that you two will talk.

Good luck!