Season 1,

85: How to Lose Money by Investing in Single Family Homes with Joseph Gozlan

October 13, 2017
MP3

Joseph is a multifamily investment specialist and founder of EBG Acquisitions. Leading group acquisitions of over $10MM in real estate and providing asset management services to a portfolio of 156 units and growing. Joseph has over 17 years of experience in the software industry, 12 of which working for publicly traded companies such as GameStop and JCPenney which enhanced his business acumen, analytical skills and “big picture” perspective, all skills that he leverages in his real estate business.

Time Stamped Show Notes

[1:50] In Israel, they have a mentality of ownership. You are encouraged and expected to own and that increases the demand for real estate.

[7:33] After reading Rich Dad, Poor Dad it made sense for Joseph to become a real estate investor. In 2008 he and his wife bought a duplex in Plano, Texas.

[9:09] An expense here and there after having a vacant house made Joseph realize of costs that he hadn’t thought of when he started with real estate investing.

[12:20] $45,000 dollars of expenses having the house repaired in a little over 6 months made Joseph rethink his business.

[15:08] What would happen if this expense had to be done to every house they owned? Joseph had to look for a less risky way of investing.

[18:10] A reason to like real estate is that when you buy right, the market may help with mistakes.

[20:15] Failing Forward Segment

  • What is the bottom line reason of this failure? – “Number one education: I got into it because I got in love with the idea but I didn’t really do a lot of homework about real estate and what happens over year and vacancy and all this kind of terms that when you get started you don’t necessarily learn through that. And the second one is not implementing all those safeguards when I should have.”
  • What is the single most important lesson you learned from this? – “Don’t spend your cash flow. Make sure you have a reserve account that is available for you for those surprises.”
  • What are the major ways you protect yourself from future failures? – “I’m a big believer in education. There was a full year and a half of educating myself, understanding the market, understanding the fundamentals of multi family. It was gradual, i didn’t just jump head first completely blind into the opportunity.”
  • Who do you turn to when you need help? – “In the multifamily space I have two people that I go to. One of them is a coach that has over a hundred million dollars worth of assets. The other person is the owner of the property management company that we work with, she’s been in business for over 35 years doing multifamily so she’s been around, almost seeing everything possible. And whenever I need business help or personal, I relay on my wife, very smart person, I always say she’s the smartest person in the house.”
  • What advice would you give to someone in a similar position? – “Brace for impact. If you realize it that late, brace for impact and do your best to find a way out of this.”

[26:00] According to Joseph’s point of view, those who are investing today that are not very knowledgable will sell in a few years pennies on the dollars, which means a good opportunity for those with experience.

[28:10] The Real Estate College Fund is Joseph’s book that gives first time investors a realistic view of the business and its risks and also a way to mitigate those risks.

[30:30] Check out www.ebgacquisitions.com for information about Joseph and his multifamily investments.

[30:58] Joseph’s final thought: “Know where you want to go, build your goals and drive through them. There might be some sacrifice along the way but it’s worth it.”

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