MB 076: Multifamily … Forever Cash Flow? – With Jack Bosch

All roads lead to multi-family. It seems that no matter how you get your start in real estate, the vast majority of investors come to the same conclusion: For passive, everlasting cashflow, multi-family is the way to go. Jack Bosch came to the United States from Germany in 1997 to finish his college degree. He worked in the corporate world for several years, but soon found that it did not afford the life he wanted. His visa was dependent upon keeping his job, yet the company that was struggling, so Jack was inspired to start a company of his own. Attracted to real estate because of its cashflow potential, Jack got his start flipping land. Over the course of three years, he developed a system that allowed him to do 3,800-plus deals, and he achieved financial freedom in a short time. Jack eventually moved into the single-family space, developing a portfolio of rental properties, and he finally graduated to multi-family in the last year. Today he shares the specifics of his transition to multi-family, his experience raising money for the first time, and his advice for investors who dismiss apartment buildings as an advanced strategy. Listen as he explains why he would have liked to get into multi-family sooner, and how you can get started in the space with no prior experience. Key Takeaways [2:12] How Jack got involved in real estate Constant travel for work Only two weeks’ vacation Not the life he wanted to live Company struggling, many lost jobs Visa dependent on employment Desire to start own business Real estate appealed because of cashflow [4:00] Jack’s start in flipping land Could sell land for seller financing Generate long-lasting passive cashflow [5:36] How Jack defines a transaction One-time cash deals (flip house, get paid once) Temporary cash (give loan, receive interest) Monthly payments (flip land for seller financing, receive down payment + monthly installments for six to eight years until paid off) Forever cash (passive, everlasting income via multi-family) [8:47] Jack’s transition to multi-family Began working real estate in 2002 As of 2009, still hadn’t touched rental properties (thought too complicated) Discovered houses available for $50/ft² Purchased several dozen, rehabbed and managed themselves Made mistakes (bad tenants, spent too much on rehabs) Eventually found good property managers Learned to systematize Still not hassle-free (deal with one property at a time) Realized multi-family properties provide buffer [12:52] Jack’s advice around the multi-family learning curve Acquisition, sourcing, negotiation, analysis and management processes are different Look for a partner-expert to learn from Jack did first deal on 93-unit in Louisiana with experienced friend Experience was ‘hands-on MBA in multi-family’ Now building own team, additional funding sources Still works with partner on bigger projects Looking to build out own portfolio as well [18:10] Jack’s experience with raising money First time on multi-family deal Benefitted from having reputation in market $1.4M raised in short time Felt responsibility as steward for someone else’s money [21:01] Jack’s conclusions about multi-family At top of favorite investment methods list Securing good property management company is key Low risk, high reward (extremely safe investment) 93-unit property has doubled in value Recession-proof (extraordinarily low default rate) [22:48] Why Jack would have liked to start multi-family sooner ...