MB 124: The Shortest Distance Between You + Financial Freedom = Multifamily – With Josh Eitingon
What is the quickest route to financial freedom through real estate? Do not pass Go. Do not collect $200. Go directly to… Multifamily. But how do you overcome a lack of experience and capital to accelerate the timeline and jump straight into apartment building investing?
Josh Eitingon is the founder and manager of JAE Property Group, a real estate investment company specializing in 50- to 150-unit value-add multifamily properties outside the New York metro area. With the guidance of a coach, Josh made his first multifamily investment in 2012, and now he is up to eight deals. He began his real estate career while working as a software developer, eventually joining a Long Island investment group where he led the acquisitions team in securing $100M in real estate. Today, Josh is a full-time investor in his own right.
Josh joins me to discuss the early investment in a coach that facilitated his shortcut to multifamily. He addresses how he overcame a lack of experience to do his first 20-unit deal and the personal guarantee he made investors to raise $200K for the renovation. Josh explains what he loves most about multifamily investing, describing the challenge of finding a formula to optimize each new property. Listen in for Josh’s advice around investing in your own deals, choosing the right location, and scaling up a multifamily business.
Key Takeaways
How Josh got started in real estate
- Hired coach to force action
- Multifamily made sense as asset class
Why Josh invested in a coach
- Working 9-5 for software company
- Long-term time, financial freedom
Why Josh went straight to multifamily
- Dumb luck + mentor’s help
- Ability to scale
How Josh overcame a lack of experience and money
- Partnered on distressed 20-unit in Cincinnati
- Raised $200K from family, friends and co-workers
How Josh overcame his reluctance to do the first deal
- Poor condition, no background in renovation
- Concerns around taking on debt
- Believed in deal, commitment to go all-in
The factors for success on Josh’s first deal
- Coach reinforced right path
- Good location, visibility
- Less than $10K/unit
How Josh raised $200K for the deal
- Talking up real estate for 6 months prior
- Personal guarantee at 9% interest
- $10K chunks
The additional risk of raising money in debt
- Bank loan for 80% + promissory notes
- ‘I carry burden, not investors’
How Josh’s first multifamily deal played out
- 20% occupancy, 0% economic occupancy
- Spent $5K/unit on interior renovations
- $50-70K on exterior, mechanical improvements
Josh’s subsequent multifamily investments
- One or two deals per year ever since
- 44- and 62-unit in same market
- 70-unit in Florida
What’s next for Josh
- 90-unit in Minneapolis under contract
- Continue on same path, 2-3 deals/year
What Josh loves about the business
- Creativity (partner, invest and find deals)
- Find formula to optimize each property
The challenges of scaling a multifamily business
- Source of equity
- Right partner for any given deal
Josh’s advice for aspiring multifamily investors
- Start saving money to invest in own deals
- Commit to ongoing education
- Right people around you (accountability)
Josh’s AHA moment around location
- Good schools, retail in area
- Allows for operational consistency
Josh’s top mistakes
- Could have done more deals
- Checks and balances on construction management
Connect with Josh
JAE Property Group
Resources
Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank
Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki
The Deal Maker Blueprint Training & Certification
The Michael Blank Coaching Program
Free eBook: The Secret to Raising Money to Buy Your First Apartment Building
- Download
- Text “secretbook” to 44222
