Today, I am delighted to share a conversation I had with Joe Lieber, Founder of JL Investment Group.
Joe has a wonderful temperament and mindset as I am sure you will hear. He is also a 22-year veteran of the Real Estate industry, based out of Cleveland, Ohio in the United States. He has over 100 high-cashflow, single-family homes that are completely debt-free in what he calls a ‘lifestyle by design, not by default’.
If you want to learn how to build cashflow to fund a lifestyle for 30 years plus into the future, you will enjoy this particular heavyweight I’m sure.
I will also share details of a Pop-Up Mastermind Event of my own in London on Monday 12th August, themed around growing and scaling your property business.
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Resources mentioned
Contact Joe Lieber:
- Website: https://clevelandinvestor.com
- Telephone: +1 440 387 4800 (extension 2)
- Email: REbroker216@gmail.com Property Deal Tips & How to Reach me By Telephone
The Property Voice Mastermind Dinner on Monday 12th August 2019 in London, event info HERE
Property Deal Tips & How to Reach me By Telephone
Link to the Podcast feedback survey
TPV Apprentice Programme info HERE
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#PropTech: A guide to how property technology is changing how we live, work and invest – a link to the latest book.
Property Investor Toolkit – here is the book link on amazon.co.uk & amazon.com in case you would like to get yourself a copy to accompany this series
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Transcription of the show
Hello, and welcome to another episode of The Property Voice podcast. My name is Richard Brown and as always, it’s a pleasure to have you join me on the show again today.
Today, I am delighted to share a conversation I had with Joe Lieber, Founder of JL Investment Group.
Joe has a wonderful temperament and mindset as I am sure you will hear. He is also a 22-year veteran of the Real Estate industry, based out of Cleveland, Ohio in the United States. He has over 100 high-cashflow, single-family homes that are completely debt-free in what he calls a ‘lifestyle by design, not by default’.
If you want to learn how to build cashflow to fund a lifestyle for 30 years plus into the future, you will enjoy this particular heavyweight I’m sure.
I will also share details of a Pop-Up Mastermind Event of my own in London on Monday 12th August, themed around growing and scaling your property business.
Property Chatter
Joe Lieber
A Turnkey Real Estate provider from Cleveland, Ohio
‘Cashflow guy’ living a passive lifestyle through rental properties. Lifestyle not by default but by design. In business for 22 years since leaving school.
Joe takes the summer off from 1st June to August 23rd
The constant in rental property investing, still acquiring today…mainly through word of mouth.
Started in construction in 98. Then bought a house with a friend and flipped it aged 17 or 18 straight out of school. Lost $4k each on that deal! Never, ever give up. Lloyd – Joe’s partner quit but Joe did not…second deal on his own flipped second deal for $35k profit…more than his parents made in a year working their jobs. This created the momentum and drive to pursue this.
Flipping houses is very transactional, so was difficult to build a lifestyle off a transactional business. Joe literally visualised his money sleeping on the job! So, he wanted to get his money off its butt and get to work…instead of putting himself to work. The magician, not the mule effect.
Started buying rental properties – took 10 traditional loans, owned 80 houses at age 25 in different family names. 50/50 partnerships and private money for down-payment.
There were highs and lows…90 family homes, not really cashflowing that well. Big mistake – not having a mentor until 12 years in! Push the button on the elevator to go straight to the top floor – invest in your education.
Mentor advised switching to rent-to-own, which reduced the cost by passing over repairs and maintenance to the tenant.
Financial crisis – started buying properties from $5k to $25k using private money. Networked with high-network people, offered them the opportunity to invest passively. Treat one rich guy well and you will never have a problem with money again. Used 5-year amortisation loan at say 10%...break-even over 5 years and then the properties were fully paid off after the loan was repaid. Went crazy with this.
Got to 217 single-family homes…a tipping point…operating alone. Decision: go to 300 and staff up or scale down to self-manage. So, decided to sell 100 and use the equity to pay off the balance on the rest. January 2017 entire portfolio was fully paid off. 100+ single-family homes paid off.
5 Reasons to Invest
- Cashflow – quit the day job
- Appreciation – capital growth
- Depreciation – tax offset
- Amortisation – getting the equity paid off over time
- 1031 Tax Exchange – what we would know as capital gains rollover relief
Value-adding properties – add bedrooms and rent to Section 8 / benefit tenants…they tend to stay for over 5 years…at a rental premium. 3-bed to 5-bed increased value from $70k to $90k+ and extra rent as well.
Now have 115 properties, buy new assets with a view to selling them. So, Joe offers finance to the buyers, acting as the bank. This is called Notes (Loan Notes). This removes Joe from the operations and into a more passive side of the business. The loan of Uncle Joe!
Turnkey Properties – Joe buys distressed assets, paying cash in 7 days. Rehabilitate them. Tennant them. Enjoy the cashflow for 3-12 months. Then sell them with owner financing on them to an investor.
Access to money – acquire with own cash, ‘everyone will lend money when the deal is good. Holding the paper (the loan note), a 30-year note is worth 3 times the original value of the loan, so $60k turns into $180k. Another option is an assignment of collateral on the note, which allows access to the funds in the loan with the loan as security.
How do you get people to back you?
Surround yourself by high net worth people e.g. join a country club and play golf or tennis with them. Money never gets old!
Then its an easy conversation…say what you do…’I buy underperforming distressed assets and great prices’. Lend, partner…
Offer security – the property deed (a charge to us).
Have you suffered difficult moments?
Never bounced a cheque or filed for bankruptcy over 22 years.
Invested in education
Never really screwed it up too bad.
Drifted away from his usual market in 2009 with a multi-family building…this was a mistake. This stole a lot of time, but it did provide education and broke even…the lesson: stay in your lane!
Mindset
There are 360 angles to look at things…so Joe looks at the positive side of things, that he can control.
Darren Hardy – Darren Daily – automated email
Education
Masterminds – top people in each market, collaborate a couple of times a year. These are high achievers…people that flip 20 houses a month. These groups are put on by the members…the group solve the problems. Access multiple brains to solve your problems.
Don’t take the stairs!
Secret sauce
$10k to go on vacation – how to fund this a couple of times a year? Don’t be transactional…have recurring revenue. Real Estate is an active, passive investment. But set it up once and it pays you forever. Use transactional money for the toys and playthings. This is what keeps Joe on top.
It doesn’t happen overnight…just as it does with becoming a doctor.
There is no better time than right now to invest in real estate. Get involved as soon as you can.
Lazy man investing – buy a house and put on a 30-year mortgage…at least do that.
Contact Joe Lieber:
- Website: https://clevelandinvestor.com
- Telephone: +1 440 387 4800 (extension 2)
- Email: REbroker216@gmail.com
Remember, if you want to talk about anything from today’s show, or just talk property investing more generally, email me at podcast@thepropertyvoice.net, I would be happy to hear from you! The show notes can be found at our website www.thepropertyvoice.net
All that is left to say, is thank you very much for listening once again this week and until next time on The Property Voice Podcast…it’s ciao-ciao.