The School Of Cash Flow

How do you create a lifestyle that you want? Dale Corpus introduces Jon Huber, who manages a 140-plus unit real estate portfolio. Jon talks about how you need to figure out the life you want and work backward. Find a remote one if an office job doesn’t fit your goals. Need passive income? If full-time won’t cut it, find something you can do on the side. Make sure that everything you do leads you closer to your goal. Otherwise, don’t do it. Also, don’t compare yourself to where somebody else is at. Tune in and learn how Jon managed to travel to 40 countries while working remotely and having a passive source of income.

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Creating A Lifestyle That You Want With Jon Huber

I am connecting with more GoBundance members, and on previous episodes, I interviewed Nick DiLeone and Ryan Stenberg. They are also from GoBundance. I was able to meet all of these guys in January 2022 at Park City, Utah, for our in-person GoBundance Winter Mastermind event. It is cool to meet them in person and then bring them on the show to learn more about their real estate investing journeys.

I am excited to bring yet another GoBro to the show, and his name is Jon Huber. One of the interesting facts about him is that he has traveled to 40 countries while having a W-2 job, two kids, and also managing a 140-plus unit real estate portfolio. I do not know how he does it, to be honest with you but we will know more about it.

He is a systems guy and is able to do all of this remotely. I am excited to learn more about that. Here is a little bit more info about him as well. Jon graduated from Rowan University with a degree in Management Information Systems, and while he was in college, he acquired his real estate license and began working as an agent.

He is a self-proclaimed techie. He uses his formal training in database coding and analytics as his competitive edge in real estate analysis. Jon has a rental portfolio spanning Coasts from LA to South Florida. After joining GoBundance, he has progressed to syndications and multifamily apartments. While he is not investing or analyzing real estate, he enjoys basketball and traveling with his wife and kids. Without further ado, welcome, Jon, to this episode. How are you?

I am doing great. How are you doing?

I am good. When I read in your bio that you traveled to 40 countries, I didn’t care about the real estate part. I was surprised by that. How did you do that? How do you have time with the kids?

It is not that difficult, especially when you go to Europe because you can country hop pretty easily as state hopping here but ever since COVID came about, now that you can do everything remotely and the world has become more remote, I do not think of it as I am traveling and going on vacation. I feel like I am working from a different spot. A lot of those countries came since COVID. In the last couple of years, I have been able to work wherever I want to work and go wherever I want to go.

Amazingly, you have done that. For my audience that does not know you, where are you geographically based?

I am geographically based in South Florida. I am in Boca Raton, North of Fort Lauderdale. That is home. I am originally from New Jersey. I also lived in Los Angeles at one point, but now, I have lived here for a couple of years. I generally stay here 8 to 9 months out of the year and travel in the remaining.

I want to cover a little bit more in your bio and your history, and because we connected through GoBundance, I want to start there. Remind me, when did you join GoBundance, and what has it done for you since you joined?

I joined GoBundance in 2020. I am the Florida Chapter Leader, so I manage all the Florida GoBros. GoBundance has been amazing for me. My business partner was in GoBundance years prior. I always wanted to join but I always felt like it was a pissing contest, and I am not the flashy type of guy. I drive the same Jetta. I do not live above my means. I travel but that is about as far as it goes but then I learned more about it and realized that is not really what it is. It is one guy helping another.

I decided to give it a shot, and I have been floored. I am super impressed with the guys and the leadership. I am on a GoPod. For those that do not know, it is four guys that go intimate, go deep into whatever vulnerabilities they may have, and the stuff that I can’t talk about with my friends. That was the reason why I joined GoBundance. It is because I would have these major wins, and I couldn’t share them with my friends.

I can’t share some of the most significant deals that I have made with a good friend of mine that makes $40,000 a year when I am doing that in a transaction. With respect to them, I have always kept that to myself, and it wasn’t fulfilling. I am high-fiving myself, and it is not that I need the high five. It’s just that I would love to surround myself with guys that are doing more than what I am doing or people that are going to push me because those five people you surround yourself with are so true. That is what GoBundance has done for me.

Let’s talk about your real estate investing journey. A lot of people I interviewed have their W-2, and then they leave it but you still maintain it. It sounds like you started real estate investing a long time ago. Can you talk about that and even what your first investment was?

Yeah. I am happy to. I come from a real estate family. My mother was a single mom with four kids. She didn’t have a college degree. She got into real estate in 1984. My sisters ended up getting into real estate, and then they married other realtors. I’ve naturally got my license while I was still in college. I was a real estate agent from ’04 to ‘07. Once the market crapped out, I was a twenty-something that didn’t have the clientele to withstand the market crash, so I fell back on my degree, which was a Computer Science equivalent.

I’ve got into the tech space in New York City, and then I moved out to LA. I’ve got back in real estate living out in Los Angeles, which makes me look like a genius for buying a property in Los Angeles in 2012. That has been great. I still have that property in my portfolio, and that was a primary that when I moved, I still have it, and I am renting that out but then as I’ve got into my investing, I started investing in South Florida because I vacationed here, I was very familiar with the area, and also, it was cheap back then.

I was priced out of the market here in 2015. My first investment was a single-family home, and then four months later, I bought a triplex. I had organic growth. I started with the single, then the multi. I started getting bigger and into apartments, using other people’s money, and then partnerships. Now, I call it having graduated to syndications that I am doing out of state as well. I have a property in Los Angeles but the bulk of my portfolio is in South Florida, Kansas City market, and Charleston.

It is in multiple areas. I want to unpack how you determined to invest in those areas. Is it because did you have the connections there first or did you do research and say these were good areas and you are going to find the connections there and were boots on the ground? How did that work?

I am glad you asked because this ties into my background in data management. I use data to determine where to go. When I was investing in South Florida, I had a property in Florida and California but I am not getting any money in my pocket. They are appreciating and doing great but equity is not paying my bills, so I needed cashflow.

I started looking at what were the best cashflow markets. I looked at the data. I looked at population trends, home sales, rent prices, unemployment rates, job growth, property taxes, and whether they are landlord-friendly. I looked at all the data that I could possibly look at, and I determined Indianapolis, Kansas City, Charlotte, Atlanta, and Memphis. These were the five that I really wanted to focus on.

I physically went to these places, which I do not think enough people do. You are willing to invest a couple hundred thousand dollars into something but you are not willing to take a $300 flight to this place. I’ve got to Kansas City and saw the cranes in the city. I saw people were investing in the infrastructure. I was like, “This is it,” but then, it gets a little bit further when you look at the data.

This is just a general statement. There are going to be loopholes to this. The way I look at it is this is a bull’s-eye theory. There are different investment strategies for different parts of the market, so your downtown area is going to be your bull’s-eye. That is going to be your appreciation play because you could buy a high rise in any downtown city, do nothing, and probably sell it for profit in two years. Again, that is a general statement but that is the appreciation play.

You then have this secondary ring, which is going to be your suburbs. This is going to be a good school system and where you work in that primary area but you need to live outside of it because you have kids now, and you want the school systems. The wife falls in love with the kitchen and the bathroom, and that is going to be great for your flippers because that is going to be your emotional buyer. There is one more ring outside of that, and that is your tertiary market. These are going to be your blue-collar workers. They may not even have a bank account but these are the people that do not live or work inside the primary area but you are close enough where you are not losing any of the amenities.

In the tertiary markets of Kansas City, you can still drive in for a baseball game or go use the airport like in an area in Tulsa, for example. They do not have a major international airport or any sports teams. It is not that sports fans are better tenants. It’s just that it is an amenity when there is a monster truck rally or whatever concert you want to see is going to be at the stadium. It is not going to be in these smaller local markets.

That is how I used the data to find out where I was going to invest. I found an awesome tertiary market in Kansas City and ended up getting around 142 units there in 2 years. I still have a bulk of that portfolio there but I had to trim it down a little bit because there were some things that didn’t meet my investing criteria. If I wanted the good, I had to take the bad. For example, the guy said, “If you want the 24-plex, you’ve got to buy my duplexes and singles.”

All this stuff with this research because you are good with data, were you pulling all this data yourself? Is it from different websites or is there a central place to pull this kind of info?

Create A Lifestyle: Digging into the data is great because it’s an excellent resource for job growth or an employment.

I am a data junkie. I love digging into the data, underwriting, and numbers, which is great because there are so many people in this world that hate that. A great resource for anything job growth or unemployment is from the Department of Labor Statistics, and that is at the county level. You can get that information.

If you are a data geek and you want to see the minute data, there is a website called City-Data.com. They will go down to what are the most popular last names and the percentage of houses that have electrical heat over gas heat. Those are the most minute data that you would never think possible but it has everything greater than that, too. It is great for data, so for any data geeks out there, go to City-Data.

This is all free information. I have been on that site before, even for stuff not related to my real estate sales business. I know what you are talking about. That is amazing. You were using all your own money for quite some time. At what point did you start bringing in other people’s money? What was that progression like, and how did you know you needed to do that?

I didn’t know. This is the power of partnerships. I had, probably, Los Angeles and Florida, and I started getting some stuff in Kansas City. A very good friend of mine who’s now my business partner and GoBundance member, Emanuele Pani, says, “How is it going in Kansas City?” This was in 2015. I was like, “It is awesome. My cash-on-cash is 24%.”

I was crushing it in cashflow, which is great because I have my cashflow and appreciation in real estate. I was like, “It is feeling great.” He was like, “Why aren’t you buying more?” I was like, “I ran out of money. I bought a 6-plex, a 5-plex, and a single. I can’t buy everything.” He was like, “Of course, you can. We are going to start a partnership. It is going to be 50/50. You buy all the real estate, and I will get all the money.” I was like, “That is awesome. That works.”

We partnered up and ended up going 50/50 on about 140 units. That is how I started bringing other people’s money in. We kept it simple. We made promissory notes. We had one investor per property. We didn’t get pool funds. It was all friends and family. They were the bank and funded the deal. We funded the construction or whatever rehabs were necessary, and then we would either sell it turnkey or refinance, and then the investor would get their money back. It was pretty simple. It worked out really well for a long time, but now, we have moved towards the syndication model that it does not even make sense to keep our portfolio in Kansas City anymore.

You talked about how you differentiate between your cashflow in real estate and appreciating real estate. For my own knowledge, how do you differentiate between the two? Is it geographic-based? For example, the place you had in SoCal in LA, is that where you are appreciating in real estate? I want to understand the difference.

How I differentiate is whether it puts money in my pocket or not. If it puts money in my pocket, then it is cashflow. For example, the property in Los Angeles, I had a tenant in there for about five years, and I was losing $300 a month, which as per BiggerPockets BRRRR strategy, that is the biggest no-no. They are like, “Losing money every month is terrible,” but it was in Venice Beach. The property is appreciating more than $3,600 per year. No one can talk me out of that.

I am only losing $300 a month. That is awesome but now that everyone knows about Los Angeles being rent-controlled, I couldn’t increase the rent, so I was stuck. They moved out, and then I’ve got a new tenant in there, and now, I am cashflowing because I increased rents to $800. I am cashflowing but the appreciation outweighs the cashflow, so I may make $12,000 a year in cashflow. The property is going to appreciate more than $12,000 per year. It is doubled in value. That is how I would differentiate the two.

I am in the San Francisco Bay Area, and I see it the same way as you. The only properties I own in California are the ones that I previously lived in that I still kept as rentals but all the other stuff I do real estate investing related-wise is a lot of times in syndications and areas out of state because it makes sense. That pays for anything that was negative because I had a San Francisco condo rental that used to be negative for a while. This was before the tech boom happened. When the tech boom happened, then it became cashflow positive.

Regardless if it is cashflow positive or not, it didn’t matter because the appreciation was always going to be there, and I always had some positive cashflow elsewhere covering for it anyway. I could relate to you completely on all of that stuff. Going back to the types of deals that you are looking at since you have some syndications, can you walk me through a type of deal that you go for?

In the syndication?

Yes, like multifamily. Is there a certain project size, building size, and whatnot that you look at? Walk me through a typical deal.

Now, the wheelhouse or the bread and butter would be anything from 20 units to 200 units. We are looking in the Charleston area. We are looking between the 100 and 150-unit space, so that would make us have a purchase price of anywhere between $2 million and $60 million. That is quite a large range but it is not so much about the purchase price. It is more about the return. Are we going to get the return? Once you get to that level, the purchase price does not matter. I would love to say that it does matter but it does not. It is more about the return.

If you can get a $5 million deal with an 8% return or a $10 million deal with a 10% return, go for the $10 million one and figure out a way how to get $5 million more. If it means bringing on another partner, then you do it because that is what you do. We are looking from 20 units to 200 units. We love C and B Classes, and the reason we do not go for the A-Class property is that all the meat is off the bone. Somebody has already gone in, renovated everything, maxed out all of the rents, and now they are trying to sell it to you and package it, which is great.

I can’t wait to get to that level where I do not care about value add, and I want to do something completely passive but now, I am grinding. I want to grind and bet on myself. I want to look at a property and say, “I know that I can increase rents to $300 to $400 on every unit. I know that I can put some money into the CapEx, and I know that I can get more on the return.” I want to do that because the more work that you do, the more money you make for investors and yourself.

That makes sense. When you are doing due diligence on these properties, you do not get every single one that you look at. What are the types of things that are deal-breakers on properties that you pass on and say, “I can’t do this deal.”

I do not know that there are any deal-breakers. Everything is negotiable. If there is something that is a glaringly red flag, work it into the purchase price. I do not get scared of anything anymore. Do not get me wrong. I have had problems but everything is negotiable. Somebody is selling for a reason. There is a red flag in there somewhere, and you need to find it.

You have to find their motivation for selling it because if somebody is like, “I have a cash cow. It is a beautiful property, and it is perfect. I do not know what to do with it. I might sell it,” no one has ever said that. There is a reason they need to sell, whether it is a busted pipe, a foundation issue, the roofs need to be repaired or they have problematic tenants.

I bought a six-plex in Fort Lauderdale. I had since gotten 4 of the tenants out of the 6. They were horrendous. They were just staying there. Those were professional tenants that would not leave the apartments. We tried Cash for Keys. We tried threatening with eviction. We had to take them to court, and then they kept postponing it.

They knew how to work it but I’ve got a great deal on the property, and now, it looks like a great investment. Of course, I had that headache for 9 or 10 months but I am willing to do that work. I am going to get to a point in my investing career where I am going to be like, “I do not need to deal with that anymore. I have already dealt with that stuff. I am dealing with it now because I am grinding.”

I know you do a lot of multifamilies. That is your main niche. Are there any other asset classes outside of that?

Self-storage is a hot topic but I am not into it. I do not know enough about it. I do not know enough about the value add. I stick with what I know and with what I am good at. Retail scares me. How often do you go somewhere to shop as opposed to what you used to years ago? This is the thing. No matter what you do, what your business and retail are, you are still going to need a place to live. That is the way I look at it. I do not care if you are in the metaverse. You are still going to have to stir your service somewhere, so pay rent. Multifamily is the best.

I am agreeing with you, especially in the long-term. People need homes. Where else are they going to move? Is it to the metaverse?

There is not enough housing in this world. Everyone needs a place to live.

You have properties in multiple cities. My assumption is that you have property managers. I do not think you are managing this stuff yourself. I want to now unpack the fact that you are able to do all of this still all while traveling and having a W-2 job. How do you do that? Who’s on your team? How do you make this happen?

Create A Lifestyle: If you want to do syndications, go for broker relationships.

First off, with the W-2, I have an arrangement with my boss. He knows what I do. I do not keep that private. He knows I am in real estate. Before I even signed on, I let him know this. I was like, “I do real estate. Would you be okay with that? If something comes up, I’ve got to take care of it.” He is like, “If you get your work done, what do I care?”

He is the best boss for me to have. I still like the W-2 for two main reasons. Number one, lenders love to see a steady income. They love to see that when I am applying for loans. Number two is health insurance. That is a big one knowing that these two things are taken care of. I am in the tech space still, so it comes naturally to me. It is pretty easy. That is why I still have the W-2.

Outside of that, how do I have the portfolio? How am I able to travel with the kids? It is all systems. I have property managers. I have empowered the right people. This was trial and error. I went through four different property managers in Kansas City before I found my rock stars. I also have another person out there that I have empowered with direct access to my checking account. This is a high level of trust. They have direct access to my checking account and pay contractors on my behalf.

If a contractor is doing something, they will verify that they are there on site. They will take pictures. They are like, “We did the flooring.” I am like, “All right.” He checks the flooring and sends me pictures. I am like, “Write him a check.” I have empowered the right people to do the thing so nothing will ever bottleneck with me, and that is the biggest thing. You have to see where you are the bottleneck because you have to remove yourself from the process.

Michael Gerber said on E-Myth, “Work on the business, not in the business.” You cannot be a part of it. If you have to get out a little sliver and have to pay somebody, it is worth it. Trust me. Also, since COVID happened, which allowed me to travel, it forced me to create systems. If you didn’t adapt to a remote world, you died. All these businesses failed because they did not pivot or adapt. What do you do? You have to empower the right people. If that means hiring more people, then that is what you have to do. I have three VAs. I have one guy doing underwriting.

I have one guy doing letter writing for my marketing, and I’ve got another one doing data scrubbing that helps me get the addresses and whatnot for me to do my off-market campaigns. You need to do this because you do not want any marketing held up. You didn’t do the research because you are the data guy, and you can do it better. There are people that are out there that are better than you at whatever you are looking to do. Trust me.

You have to put these systems in place, and one way to do it is to take two weeks off, see what happens and what does not happen because of you. You then put somebody in place or you change the process and make a different protocol that says, “When this problem comes up, I am not the go-to guy anymore. It is going to be this person,” and then you keep doing that. It sounds so much simpler when I say it but each time a problem comes up, make sure that when the problem comes up again, somebody else takes care of it.

In my real estate business, it is a we business. I do have two virtual assistants and agents but I still am part of the process. I do not have a vagus where I could fully step out yet. Where are you? Are you a we business or a they business? Is it both?

It is everything except the syndications, which is great because I enjoy that. I really enjoy the syndication part of it because of the thrill of the bigger deal. We have a great team, and we all have our roles. There are four of us, and because there are four of us and we all have our roles, it is less work and more reward. That is so awesome. I am doing less.

Before, it was a 50/50 with me and my partner in Kansas City. Now, I am doing 25% of the work because it is all the same work, whether you are buying 50 units or 5 units, it is the same work. I know your audience has heard over and over to go for bigger deals because it is the same amount of work, stress, and due diligence. Now, I am on a team of 4 instead of a team of 2. My workload is cut in half, and it is more specific.

For your syndication side of the business, how did you find your business partners?

GoBundance. They are all GoBros.

Were these all people from your GoPod?

This was on GoPod.

Did you all happen to have complementary skillsets?

Another guy and I have very similar skillsets with underwriting, numbers, and digging in things, which is good because it allows us to split that. He can do initial underwriting to see whether that is a good deal, and then I can do the P&Ls on the actuals to see if everything is what it is. We can both dive into the numbers in very different ways. Also, a role that I have taken on is I am persistently haggling brokers for deals.

I love the hunt of the deal. It is awesome. I’ve got on, and I am super pumped up. We are going to submit an LOI on it. I have been working on that one for about 3 or 4 weeks. I was working on that one when we were in Park City together. This one is finally coming to fruition, so I am really pumped up about that one.

There is another guy who is doing property management and checking all the leases and estoppels. I do not want to do that, so I am glad that there is somebody else doing that. We also partnered with a local group with this guy in Charleston who is our boots on the ground, and that started because we were like, “If we are going to be investing in Charleston, we need a local guy. Let’s email all the GoBundance guys in Charleston.” One of them came back and he was like, “I am in.”

We were like, “We are going to give you equity but we want your contacts, property managers, contractors, and everybody that you have contacts with.” He was like, “You do not need to do that. I will bring you on as a partner.” We were like, “That is cool,” so now, he is a partner. He worked his share, and it has worked out great.

We closed one deal in October 2021, and that was more like a test case. It was a smaller one. It was 28 units. We were like, “If this deal is going to work, this is a good test case.” There were things that didn’t work, and we had to make changes. We had to change the structure of the teams a little bit, but now, we are closing on another one in March 2022, and I believe we have honed in on how we are going to do it and how the process is looking forward. As we scale, we have already talked about adopting a traction EOS system. We want to really scale this thing up. All of us talked about it when we were in Park City. We are all onboard, and this is what we are going to do moving forward.

On the virtual assistant side, I wanted to ask you something about that because I also have virtual assistants. How did you find your virtual assistants because you have multiple ones? What does each of them do? Are they all full-time?

They are not all full-time. It is very test-based. I found them on Fiverr. I have probably gone through about 12 people on Fiverr and kept 4. I have a guy that helps me out with the social media content because I am not a creative director, and I am not good with Photoshop. He does all that for me, which is awesome. Another guy does the underwriting. He does not do the analysis on the underwriting.

He does the data entry because that is the biggest pain. I started to think about it. I was like, “What do I dread doing?” I love looking at the numbers but sitting there going through the rent rolls like, “This rent is $500, and this one is $800.” If you are doing that with 50 units, it is tiring, so one guy does the data entry there. I then have another guy that is doing the marketing with letter writing. He is handwriting letters.

Is that person in the United States?

No. He is a calligrapher based out of India. I hit him up and was like, “I need you to write letters.” He wrote me a sample letter and I was like, “You’ve got to tone it down. This looks like old English calligraphy. No one is going to believe I wrote this. Maybe even misspell a word. Get a little sloppy for me.” We had to tone it down a couple of levels but it works out great. It is cheaper to have him do it and pay for shipping than to have someone do it here.

Do I have to post this stuff, for example, from India?

Create A Lifestyle: There’s a reason that somebody is selling, and you need to find it.

No. He does the letters and puts them in the envelope. I will check them out but I will seal it and put a stamp. It gets even better. I then will send it to Charleston or I will fly it when I go to Charleston and make sure that I send it from a Charleston Post Office because the postmark needs to have a local postmark.

Also, I have a phone number that is local to the Carolina’s as well. I did this in Kansas City when I was marketing to all the Kansas City properties, too. I have a Kansas City phone number. I have the letter, and I have my number at the bottom, so it looks like I am a local good old boy looking to try to find another property. I have a local postmark, a local number, and a handwritten letter.

I get it. One thing I also connect with you on is the fact that you do utilize social media like Instagram and TikTok. I know your social media handle is @JonTheTravelingInvestor. Your stuff is really fun. How do you leverage social media for anything? Is it just for fun or do you use it for business? Tell me more about that.

I am not looking to convert syndicators out of social media. It is a passion project. My two greatest hobbies are real estate and traveling, and it merges the two. It allows me to express myself creatively. I go to some cool places. Whenever I do that, I want to look at properties. I went to Panama over Labor Day weekend. I saw high rises for sale, and I am like, “I’ve got to go check them out.” The whole time I was in Panama, I was like, “I’ve got to go check these out.”

I connected with a realtor and I was like, “Let me go check them out.” If something works out, maybe I will get it but it didn’t work out. I am able to say, “Here’s a 1-bedroom and 1-bathroom in Panama. What do you think the price is?” I do not know if anyone has had an in-depth look. I was in Turkey for five weeks. I was showing people like, “Here are what properties in Turkey look like.”

When I am in Sweden, I am like, “Here are what properties in Sweden look like.” When I am in Panama, I am like, “Here are what properties in Panama look like.” I have another trip planned for March 2022. I plan to do the same thing. I like to connect in real estate, connect in the places I am at, and show people what it is.

You are talking about many of your travels, having fun while at it, and teaching people a few things. You have traveled more than a lot of people. This is a traveling question. You have been to 40 or so countries. Is there any place that you want to go back to that you have already been to because it was that cool? What is it? I am curious because I do not travel enough.

It is Dubai. Dubai came about because it was my wife’s 40th birthday. I was like, “I will take you anywhere you want to go.” She is like, “I want to go to Dubai.” I was thinking it is going to be super expensive that it is going to be princes, Bugattis, and Instagram models. I was like, “That is not my scene,” but I promised I will do it. I went there, and it was awesome. It was not flashing luxury all over in your face. It is a beautiful place, and super reasonable, too.

I stayed at the JW Marquis Hotel, which is the tallest five-star hotel in the world. I stayed on the 63rd floor, and it was $150 a night. I was like, “I can’t even stay at the Marriott in Cleveland for that.” I was completely shocked. It was very family-oriented. I also surfed in the desert. It was cool. That is a place I wanted to go to, and then Prague, Bali, and Iceland are some of the cooler places I have been to.

Dubai is on my list. That is awesome. I am glad I asked that.

Also, you said places I want to go back to. I am going back in March 2022 because I am bringing my mother. My mother kept freaking out. She was like, “You keep going to the Middle East.” I am like, “I am taking you. I need to change your perspective. You are never going to believe me unless I take you with me.”

I am going to go back to your real estate stuff. How are you finding your deals? What is your best lead generation source? Are you getting your deals through brokers? Are you going direct to seller? Tell me about that.

I am still sending letters. I wholeheartedly believe in handwritten letters, so I am never going to stop that, but now, it is broker relations. If you want to do syndications, it is broker relations. Every day, I am on the phone calling more brokers. I am harvesting the relationships that I have with the brokers that I have already connected with, and it pans out.

One of the biggest things that I can say is if a broker sends you a deal, give that person feedback immediately because they do not want to send you something, and then you turn into a black hole. They will stop sending you stuff, so if you say, “This is not going to work out because I am at this price, and they want this price. I do not think we are going to get there. I can submit LOI if you would like but I do not want to insult anybody, so this is the reason why I am going to have to bow out,” that will go so much further.

If they have it in writing, they can go back to the seller and be like, “This is the 3rd or 4th guy that I would come in.” If you do not bring any value to the broker, they are going to not send you deals. Show value by giving them feedback quickly or submitting an LOI because you want the deal. Those are the two biggest things I can say. Constant contact with the brokers is how I am finding the deals.

Typically in your syndications, how do you structure deals with your investors? Does it change from deal to deal? Is there a format that you follow? Can you elaborate a little bit on that?

We are pretty standard with a 70/30 split, so those financial investors that come in as limited partners would share 70% of the deal, and we, as general partners, invest financially as limited partners in all of our deals. We are financially invested in each one of these. We are on the hook for the loan. That is all on us. Any investor that invests with us is pretty protected because, 1) They are not on the loan, and 2) They are signed on as a limited partner, which means the decision-making is limited but also the liability is.

We have an 8% preferred return. We do not do a waterfall. It is pretty much standard across the board. We also are very aggressive with our cost segregations. We try to frontload it. That means people can get cost savings right away, which is a lot of the reasons why we do this. We want the tax savings. We also will have a year three refinance where the investor would get 70% of their money back, and that is done on a deal-to-deal but we have been able to do it in the last couple of deals.

We are pretty confident in the deals that we are getting that we can refinance again after three years and generally get the majority of the money back. Our investors get 70% of their investment back after year three, and then we will generally do a 5 to 7-year hold depending on what the market says. If we get an amazing deal in year five, then we would sell but if we decide to keep it for two more years, then everyone is going to enjoy the returns then.

Are there any active deals or upcoming ones that you are going to be raising money for?

We are closing on one in March 2022. We closed with our own money first, so there is never any need to say, “We need to raise money because we need to close this deal.” We are closing with our own money first, and then we have 365 calendar days to then raise, which takes a lot of the pressure off. It also lets investors know that we are invested in this deal, whether we take any outside money or not, we are on the deal. That is talking about betting on yourself.

We are also submitting an LOI on this new property. I am super pumped up about it. This one is going to be a home run and off-market. I’ve got the deal from a relationship with my broker, the one that I was working on for 3 or 4 weeks. The LOI is going to go in. We are one of the few parties that are looking at it, so that should run us probably until the beginning of April 2022, when we will close.

Here are the final questions for you. What has real estate investing done for you in your life? You can answer that any way you want.

It has given me the freedom to travel and provide for my family. It has given me a sense of purpose and accomplishment. It has become so ingrained with my identity. People talk about retiring. I do not know if I ever could. Many of my endorphins come from chasing a deal, even if it is just talking about real estate.

I have a coffee meetup that I do on the second Saturday of every month down here in South Florida because I want to talk about real estate so badly with anyone that will listen. We get 40 to 50 people that come out, and a lot of them are newbies. I will talk about real estate with somebody that has no idea about real estate. Whoever wants to listen, I will talk about it.

What has real estate done for me besides creating my entire identity? People always say like, “Could you ever imagine your life like this?” I say, “Every day, I imagine this even when I didn’t have it. Every day, I imagined that this would be my life. I would be doing real estate in some capacity. I would be traveling the world with a family that I love.” Real estate has given me the life that I have always wanted.

Create A Lifestyle: Go for bigger deals because it’s the same amount of work.

That sounds exciting. I can tell you are so pumped up about it all. Are there any big goals that you are working on this 2022 that are either personal or business?

For personal goals, I am looking to harvest and improve existing relationships. That is my major personal goal. My major professional goal is I want to add 500 additional units with this GoPod group that I have. That is a collective goal. We have all talked about that. We all believe that that is attainable, and that is what we want to do. I am a big goal-setter. I have a five-year planner that sits next to me at all times. I set my goals, track my goals, and make sure that I do what I do.

Everybody has their own unique skillset. What is your own superpower that has helped contribute to your success?

My superpower is I can take massive amounts of data, and I can compute it, spit it out, and dumb it down. That is when I came to the tech world. I can dumb down the most advanced tech and speak to somebody that does not even have a high school diploma and merge the two. That is why I believe I moved up in the tech space because when it comes to the tech world, a lot of people are socially inept.

They would just put their headphones on and code, and that is so common. I can talk to that person at the high technical level, and then I can get the user requirements from the person that just says, “I want it to do what I want it to do, and I click a button.” That works in the real estate and the tech world. I can take the large amounts of data, and then I can make it digestible to someone that does not understand it and make it understandable.

This is a perfect example. Someone asked me, “How is the deal that you were doing that closed in October 2021?” My brain immediately goes to, “Our projections are at this percent, and we are also seeing this,” and I am like, “They are not going to understand that. They do not even care about numbers,” so I said, “We are seeing year three rents now, and we are double ahead of schedule in turning over the units. Instead of turning over one unit a month, we are turning over two units a month,” and they are like, “That is phenomenal.” That is a lot of it but if somebody did want to know those numbers, I could rattle those off at the back of my head as well. I am pretty adaptable when it comes to the audience.

We are pretty much down to the end of our episode. Is there anything else that you wanted to say to the audience? Do you have any words of advice?

This is the bit of advice I give to anyone that asks. Figure out the life you want and then work your way backward. I wanted to be able to travel the world, have passive income, do real estate, and live my life on my terms. Does that mean I still need a W-2? Maybe and maybe not but I have a W-2. I needed to make sure that my W-2 was conducive to that lifestyle. That means I wouldn’t work a job where I had to be in the office, so find a job where you can do it remotely. If you need passive income, make passive investments that you can work towards because you want to make sure that everything that you do is working towards the goal.

You do not want to do something that is not going to be conducive to the lifestyle you want, so do not take on the job that you have to be in the office the whole time. Do not take on the investments that require 100% of your time. Do not do the things that are going to set you away from where you want to be. Figure out what that is, and then create the lifestyle backward. Do not get me wrong.

I understand that not everyone has the same opportunities in this world. Some things take a long time. I have been doing this for many years. I wasn’t traveling 3 or 4 months out of the year until the last couple of years. It took me a long time to get to that, so do not compare where I am at to where somebody else may be at.

That is good, solid advice. How can somebody get ahold of you? What is your best contact information?

Instagram works well. It is @JonTheTravelingInvestor. That is the easiest way. I am also on TikTok.

That is a wrap for this episode. Jon, thanks so much for joining me on this episode. I love how you broke down how you systemize things, leverage technology, virtual assistance, and even have your business grow while traveling. You live such a balanced life. It is very inspirational. To my audience, feel free to reach out to Jon directly if you have any questions for him about any of his syndications and whatnot. Also, thanks for checking out this episode. Remember to leave a review on iTunes as it helps me attract even more great guests like Jon. Until next time, live life abundantly.

Important Links

• Nick DiLeone – Past Episode
• Ryan Stenberg – Past Episode
• GoBundance
• Jon Huber
• City-Data.com
• E-Myth
• Fiverr
• @JonTheTravelingInvestor – Instagram
• @JonTheTravelingInvestor – TikTok
• iTunes – The School of Cash Flow

About Jon Huber

Family man, Traveling man, Businessman

Jon graduated from Rowan University (NJ) with a degree in Management of Information Systems. While still in college, he acquired his real estate license and began working as an agent, even before graduating. A self-proclaimed  “techie”, he uses his formal training in database coding and analytics as his competitive edge in real estate analysis. Jon currently has a rental portfolio of 126 units spanning both coasts from Los Angeles to South Florida. After partnering in Domu Private Investments, Jon has worked to triple his portfolio with cash-flowing units. After joining GoBundance, Jon has progressed to syndications in multifamily apartments. When he’s not investing in or analyzing real estate, he enjoys basketball and traveling with his wife and kids.