BiggerPockets Real Estate Podcast - 824: Bankruptcy to Financial Freedom by Following the “No B.S.” Real Estate Rules w/Jason Lewis

Episode Date: September 28, 2023

Jason Lewis made it his life’s goal to hit financial freedom by thirty-five. After watching his family go bankrupt, lose their multi-generational farm, and have to give up their dreams, Jason knew that this was NOT what he wanted his future to look like. Instead, Jason would build a multi-million dollar real estate portfolio. One without high risk, high leverage, or a bank breathing down his neck when things went sideways. A portfolio that would make him MILLIONS in tax-free income, using techniques every average American can repeat. Jason quickly learned the right way to use debt. After securing a loan at the young age of seven, Jason started raising hogs. When he became the Grand Champion for hog raising at his local fair, he was given a check for a couple thousand dollars—MORE than enough for any seven-year-old. This lesson later helped Jason repeat the same strategy, but with real estate, always adding value and ALWAYS paying his debts. Jason’s “opportunistic” way of investing allows him to buy anything and everything that makes money. House hacking, fix and flips, mobile homes, and oil and gas leases are just SOME of the asset classes that Jason has invested in. One of these allowed him to make $1.9 million using a strategy that ANYONE listening to this episode can take advantage of. Want to hear how? Stick around! In This Episode We Cover: The danger of “overleveraging” and how it can ruin your chance at financial freedom House hacking and how to make tax-free millions simply by living in your home Syndication hype and why you should NEVER “fake it till you make it” in real estate Jason’s “No B.S.” advice to find real estate deals WHEREVER you are Partnerships and when it’s a wiser move to fly solo in your investing career  And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast BiggerPockets Merch Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area Davids's BiggerPockets Profile David's Instagram Rob's BiggerPockets Profile Rob's Instagram Rob's TikTok Rob's Twitter Rob's YouTube House Hacking 101: What It Is and How to Get Started Is Leveraging Really That Risky? The 30-Something’s Guide to Financial Freedom Tune into the “Creative Real Estate Podcast” with Jason Connect with Jason: Jason's BiggerPockets Jason's Facebook Jason's Instagram Jason's LinkedIn Jason's TikTok Click here to listen to the full episode: https://www.biggerpockets.com/blog/real-estate-824 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [e-mail]. Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 824. I still own those first two house hacks because I didn't know about the two-year owner-occupant tax benefit at that time. And I was learning the value ad and I learned about the two-year owner-a-a-c where you live in a house the last two of five years. And if you're single, you can take up $250,000 tax-free. So after that, I started just finding the best deal I could find and live in it for the two years and add as much value as I could. and I started buying rentals is a little over $1.9 million of tax-free income that I've got through all of my house hacks. What's going on, everyone?

This is David Green, your host of the Bigger Pockets Real Estate podcast. And welcome to the sharpest real estate show in the West. Today I'm joined by my co-host, the Sundance Kid himself, Rob Abbas Solo. Rob, how are you? How do you doing? I'm doing all right now. Now, if you're new to this show and you came here, you're looking for a real estate content, but found yourself in a Western, don't worry,

you are in the right place. Every week, we bring you stories, how-toes, and answers that you need to make smart real estate decisions now in the current market. And this week, we're having a little bit of fun with it. We've got Jason Lewis, the Lone Ranger of Real Estate. Rob, what's the most valuable thing from this episode that investors can take away from? Oh, man, we're going to talk about the importance of networking, the importance of building relationships. There are so many lead sources in our life that we are not tapping that are perfectly

capable of landing deals across our desk every single day. These are people that we interact with every single day. We are going to talk about the power of garage sales. We get into some pretty good stuff here. Yes, we do. And a lot of creativity as well. This is a very cool guest who's taking an approach to real estate. That's different than a lot of other people. But I think it's a good one. Before we get into it with Jason, today's quick tip is very simple. Ask yourself, am I running to something or running away from something? They can both be motivators. Positive reinforcement is when you want something.

I want a Lamborghini. I want money. I want a vacation. And that's good. But negative reinforcement is even more powerful. That's the removal of adverse stimuli. So it's more powerful if you want to come in outside from the rain than if you just want ice cream for dessert.

Jason talks about how in his life he was running away from pain that he experienced in childhood, and it's been a great motivator to keep him grounded, focused, and defensive-minded while building his portfolio. I thought it was a wonderful perspective, and I'm happy for everyone to get to hear it soon. What if I told you you could forget everything you know about investment property loans? Because host financial is rewriting the rulebook, tossing out those pesky DTI restrictions. They focus on your property's income potential, no tax returns or personal income statements needed. simple, efficient, and tailored for investors like you. Imagine a lender that sees the gold mine in your property, not just the numbers on your paycheck.

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investing at NRE.com slash BPPod. That's NREIG.com slash BP pod. All right, it's high noon when we're about to get into this here duel. So let's get into it. Jason Lewis, welcome to the Bigger Pockets podcast. How are you today? Hey, thanks, guys. Excited to finally be on the episode. It's been along with the journey of the bigger pockets since back in 2015. So it's kind of interesting and fun to have it now come full circle and actually be a guest on the podcast. A little background for listeners. Jason has a $25 million real estate portfolio, has been investing for 17 years and has done

over 500 deals. As a fun fact, Jason, I understand your dad sold a bull to John Wayne. I need to hear this story. A, that's kind of the, that was his claim, claim to fame back in the day. John Wayne was a herford cattle, which Herford's is a brand breed of cattle. John Wayne was a big fan. He had the bar, I think it's 26 bar ranch in Arizona, big Herford guy. And my dad at one point back in the day, I think maybe when I was still a twinkle in his eye,

had sold a bull to the John Wayne. And that was kind of his claim to fame. name, so is a good old rancher. Whatever happened to the bull? Did we ever find out? Yeah, I'm guessing that was maybe after it had its run of getting to control the ladies in the field, he probably became McDonald's, sadly. Yeah, I never thought about that.

Do you eat bull or is it always cow? Is it all beef the same? Yeah, it's, you know, it's interesting fact. like McDonald's buys a lot of their meat is dairy cattle after they quit producing milk and they're past their longevity. That is where most of your post-milk production goes to a Big Mac. Wow. Well, that is the fact of the day.

So you literally milk it for all its worth and then it turns into McDonald's. That must be where it comes from, the phrase. So in honor of John Wayne's genre, the spaghetti Western, we're going to walk through your story today in three parts. The good, the bad, and the ugly, which if you don't know, is an iconic Western movie from 1966. In fact, I don't know if anyone is able to say the good and the bad without also adding in the ugly. It's kind of a knee-jerk response at a certain point. So let's start with the bad. I understand that your family had some hard times growing up on a farm in Kansas.

This is also how Superman was originated. So maybe there's something to your $25 million portfolio. and that was there a low point in that time that shaped you? Yeah, I had a boulder on my shoulder since I was a kid still do. People say they had a chip on their shoulder. I grew up with a boulder with the fact that I thought I'd take over the family, you know, farm, ranch, third generation that my grandpa had started back in the day. You know, we had we'd had some good success.

But ultimately, my dad was an amazing cattleman. We had 800 head hog operation, farmed ranch, you know, thousands acres. And sadly, he was not the best business guy. He was a more of the doer, and he was great at that. And it was before technology and education and YouTube where you could look up stuff. So back in the day, there was some just hard times in the farming industry, which there's, it's a very cyclical business. And the bank came knocking on the door when I was a kid and said, we want it back. He had essentially started doing some feed lots, which again, I'll love it.

Interesting fact about cattle kind of is that feedlots are where you put in a ton of cattle into a very small area and you can scale them. And that's how I give that analogy in real estate. It's when people started building multifamily. Used to be a single house, single area. You could only do one in an area, kind of like running cattle in a big open pasture. But now they do feedlots. They do commercial farming for pigs, hogs, chickens. So anyway, he went into that.

And why my real estate career was shaped before I knew it was he went, he leveraged the farm to build that multifamily of the cattle industry and essentially a COVID type of event hit. where it tanked cattle prices and when you're fully leveraged, there isn't much you can do to escape that. So that's essentially the bank came calling and we kind of moved to town and lost the farm, as they say. That's crazy. So you grew up thinking, you know, your whole life, your trajectory, you were effectively going to be like a farmer.

This was your trajectory. Did you know that you're, that you're dead. had over leverage. Did you understand the concept of leverage at this time? Or is it really only in retrospect that you kind of realized what happened? Yeah, it's retrospect. It was, you know, at that time, I was third grade and we had to go, we had a pawn that we were going to build our forever home, you know, on. And we had like a little play set over there and like some stuff. And we had to go, like, go get that, you know, and kind of like that go move to town. And that's when that boulder went on. You know, at the time, it was very exotic. I guess you could.

could say or sexy the farming. Because I was a kid, I didn't have to actually do a lot of the hard work. I just, I was watching Dukes of Hazard and cool John Wayne movies. And it was just something that I just thought I would do. And it was cool and fun, you know, you're looking up to your grandpa and you want to do what he did. So when that kind of got taken away. But luckily, I got to see from being a farm kid and even working on farms after and stuff. I just had that entrepreneurial farmer mindset because farmers are entrepreneurs.

And there's just nowadays it's become like everything else corporate farming, but a little less entrepreneurial. But historically, they were the first entrepreneurs. You know, you got land and you had to make a living off of it. There was you make a break. You either feed your family and produce an income or you literally don't survive. Okay. So what were some of those lessons?

Because obviously you went through a lot. I'm sure that was a very significant. impact on your life, what was something that came out of that? It's bootstraps. Literally what I tell people, it's bootstraps. The end of the day, my style, and how I go about my business, my personal life, my mindset is that every day you pull up your bootstraps and you probably, literally and figuratively as a farm person, you're going to deal with, you know, at some point throughout the day, throughout the week, you're going to deal with hard times. You're going to deal with stuff you don't want to deal with. And as the saying goes, you pull up your bootstraps and just every day, you go out there and

do everything you can. And hopefully at the end of the day when you're exhausted and you get back home and, you know, take those boots off, you've added a little value. And then hopefully, kind of when you kick the bucket, when you're older, you've made something better than when you started. So it's that mentality of just pulling them up, getting out there, getting in the thick of it, and just keep going. I mean, I'm sure that also brings a lot of sacrifice too, right? The concept of pulling yourself up by the bootstrap is sort of the mantra of every entrepreneur, but with that mindset and with that lifestyle, I'm sure a lot of sacrifice comes from that too. So were there any sacrifices that you made, you know, having to live out this, this lifestyle and mentality?

Oh, for sure. I mean, it's, it's, there's a pro, ying and yang, pro and con to everything. And, and that mentality of kind of that lone ranger, I'll just deal with it. I'll do it myself. I'll figure it out. And making sure that with that boulder on my shoulder that I did not go bankrupt. When I had a, you know, a goal was a young kid in junior high high school, I wanted a net worth of 100 grand. And this is all arbitrary. I grew up in a town of 1800. there was only in two stories was a grain elevator in the courthouse. So I had no idea about like true wealth and money and stuff, but it was just kind of that inherent nature.

I just, I wanted 100,000 in net worth, 18. I wanted a million in net worth by 30 and I wanted to be financial retireable by 35. And financial retireable to me was not bankruptible because my parents had me at 35. So I thought that was like forever away. I thought 35 was like 100 years old when you're, junior high. And so I said, okay, they had me at 35. My dad went bankrupt. It caused, you know, some family tension, divorce essentially, you know, kind of happened throughout that, you know, financial aspect. And I said, I don't want that to happen. So I'm going to run away from something

versus run towards something. And I think a lot of people run towards a Lamborghini, a vacation home, a plane, uh, whatever that might. B, I always have and probably always will in a messed up way run away from something, which is that event happening, which was, you know, bankrupt, moving, losing the farm, as they say. So I've sacrificed. I mean, it's just, everything I did was like, will this event get me further away from bankruptcy event that could happen in my life or closer to it?

So a $2 soda, you know, Coke at lunch, that's $2 further away from bankruptcy or closer to if I spent it or didn't. So I never used to. And I treat myself now to iced tea on occasion, but I still have that mindset. So that's a sacrifice. I mean, some and it's just workwise friends. I can help you with that, Jason. If you get an iced tea, but you drink six refills, you just divide the. the $3 by 6.

It's only 50 cents per ice to you'll feel a lot better about it. I like it. I can add on to that. If you get water and you ask for a little plate of lemons and some sweet and low, you can actually make your own lemonade in front of everybody at the table. You can even give them some. All right. Well, I have to toss into that.

I'm not a Starbucks because $4 drinks is still out of that realm. But if you get an iced tea or a hot tea coffee at Starbucks and you have the app, it's free refills. So I'll have my meetings there and I'll make sure I drink my iced tea and then get my to go one. And it's normally 50 cents if you know the app, but it's free. So who knows? They'll probably change it. That's why people tune into this podcast. Real estate's really expensive, everybody, but you can still save money. Rob, you should start buying avocados and taking them with you to Chipotle. So when they say guac is extra, you're like, not for me, lady, not for me. So I have to test this. I saw one of those TikTok life hacks, which I'm addicted to every one of them, is that you put

avocados in water and they last like perfectly ripe for like ever if you just put them in a bowl of water. And I'm like, that can't work. But most of them end up, those hacks do work. So I was like, I got to try that sometime. So you know, you also need to add lemon to avocados to stop them from going bad, which means you can get the free lemon from the restaurant, add it to your avocado, take home some water. You can basically live for free if you listen to the. this podcast long enough. Literally, that is my goal. Like, and to sum up is like, is I try and hack, you know, almost everything from my house to my cars to planes to vacation house to

restaurants to whatever. It's, uh, um, it's, it's, it's a weird, weird little thing that came from that now. I don't need to do that, but I'm just addicted to it. So, uh, so if you guys have any more of those, uh, those hacks, I would. Yeah, I'll share you the big Mac hack. I learned this from Kevin in the office. You see, you go to McDonald's every day and you order a Big Mac, but you take one of the layers of the Big Mac out of the burger. And at the end of the week, you add them all together and voila, free Big Mac. I love it. Well, listen, if anybody at home has a life hack, please leave a comment of your favorite life hack in the YouTube comments. And we will pin our favorite one to the top. There you go. All right, now, Jason, I understand

that you took out a bank loan at seven years old. I need to hear about this. Yeah, as a farm kid, you do 4H. That's if anyone's kind of grew up in a small town or even. I've heard of 4H, but no one told me what the 4Hs are. Does anyone know? Man, right when I said 4H, I knew that you guys were going to ask what that meant. And my 4H leaders, my 4H leaders were, and my mom probably will slap me,

if any of them ever would listen to this. Because you literally have to say it at like every 4H, you know, a kid it's like the Pledge of Allegiance yeah the four H's four H's is is the four leaf clover and it's heart like health hand something uh so man i literally like hershys maybe our producer has come through in the clutch to save you head heart hands and health i was guessing when i said hands i had no idea yeah hands is the helping part is that you volunteer you help others um i do remember the like hands part because that's a lot of it is you know volunteering and helping and and doing good my mom was in 4-h shout out to my mom who never told me what the 4-h has stood

for but apparently that was like a pretty big thing like boy scouts or uh rainbow girls i believe they were called so you're in 4-h and somehow this allows a bank to give a seven-year-old alone at seven you can start showing animals uh and anything i mean if you have photo or whatever at the county fair um you can start showing animals at seven. So I was counting literally the days up to one on my seventh birthday just so I could start showing animals. So I bought my four baby pigs and we raised hogs, but you know, these are show hogs. So you got to go to like show hog farm and I'm middle of Kansas, drove up there and took a trailer and I picked out my four hogs that were going to be the grand champion of the

Harper County Fair, bought four of them. And then you show them. I actually ended up winning Grand Champion hog. And you end up getting to sell and they still do it here in Douglas County and Jeffcoe and places. They'll still have auctions and people buy the hog. Mainly it's people into ag industry banks and John Deer dealers and stuff to support kids. and I sold my four hogs and I netted a little over $2,334 that year. And I went down to the bank after end of August when the county fair was and I got my check

and paid Jerry Turner back for the four hogs that I bought. And my mom made me put the $2,300 in profit into a bank account for my college. and I think I maybe was able to buy some like bubble gum and baseball cards or something like that. And then the rest went into college fun and kept doing it every year and did it until I was 18. So the hog hacking. I was hog hacking, exactly. You sold four hogs, four h's, if you will. When people buy, I've always wondered this, when people buy the hogs or the cattle or whatever,

are they buying them to eat them or? That's a very good question. I got excited. I said, yeah, before you even started, because I was like, oh, man, you know, actually. someone who ask a redneck question like that, I get excited. So at least in ours is you essentially buy it, but you're just kind of paying a premium to that person and you're writing a check. You have the option, at least in Harbor County, to then buy the hog if you want to have it processed. Then a processor will come and pick up the hogs that people actually buy.

but all of the other hogs are loaded up on a big semi and you get your check from the meat processor, the packing plant that buys all the animals. Rob is very concerned with the fate of every animal. He needs the story. It's tough, man. I'll tell you like, it's real tough. Because you get close to him, right? Oh, for sure.

And hogs, you know, not so much, but the cattle, you literally, you know, you walk them every day on a leash like a like a pet dog and then does it have a name ah some i i didn't ever allow i started to i kind in my head but i never i never really called um but uh yeah i had one four four h steer that um broke my dad's um hand and then ran my grandpa over so it was the one that i did not we did not take it to the fair because he was never would never break um but he went to the the the local meat packing plant and it was homemade meat after. But that was the one that I was, that I was not sad to see. So I'll probably going to get a lot of hate messages after sharing that story. But Jason, so like you get this loan from the bank. Obviously, you pay it back, but you're

seven years old. Are they billing you for this? Are you on auto draft, auto payment? Like, how does that work? Yeah, legally you can't sign any legally buying contract until 18, you know, in the So you can't get a credit card. You can't get a bank account. But you can co-sign. So I had my own bank account, Jerry Turner. I walked in. He had George Bush.

If anyone kind of remembers old, you know, old school, like cowboy dress pants. They're like stretchy and shiny. He wore those. He looked like kind of like good old George Bush did back in the day. And he set me down and gave me the whole speech, you know, of financial and being smart and farm kid and all that. So my mom co-signed. So it was under my name, but she was illegally binded that if I ended up losing those four hogs or they got eaten by coyotes or something, she would have been on the hook.

So legally. So you learned capitalism at a super young age. You learned the fear of we could lose everything at a young age. And then you learned there's a benefit to growing something. I mean, you literally raised animals from when they were small, which is sort of like buying a problem. property and fixing it up over time and then selling it for more. And you got exposed to this cycle of capitalism where if you add value to things, you can make money. I understand that you made $243 in this. And in today's money, that's $5,77. Can you explain that? A little over $2,400. I think I look back,

I remember asking what that was, because I don't remember it seven. And then I just kind of looking back on bank stuff when I got to be junior high. And it was $2,400 and I think $32. Okay, so you made $2,400 selling the hogs, and in today's money, that's about $5,700. Yeah, I put that in a calculator a while back, just curiosity when I was chatting with people, and they're like, what, you did Watt at 7? And I was like, wonder what that buying power today would be, like, if, what, seven-year-old? I mean, imagine a 7-year-old making $5,800. Yeah.

That's a lot of money. And you're like, I bought some bubble gum and a baseball card. Like, you could have bought a car. Yeah, literally, I mean, back then, yeah, you, I bought my first truck at 13, and I paid 55. So literally it paid for my 1988 Chevy stepside. There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest.

Vacancy periods, rehabs, short-term rentals, or LLC-held properties. These gaps surface only when filing claims. That's why investors work with NREG. They specialize exclusively in real estate investors, understanding portfolios, risk at scale, and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. NREG review your insurance with someone who gets investing at NREG.com slash BPPod. That's NREIG.com

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And again, it's real estate related shows. So I don't want to want to kind of maybe get away from all the hogs and the farming case people are not into that or that might not be a fan of them, vegans and such, which I fully understand and respect. But how that came about was I owned a auto motorcycle dealership. I started when I was in high school and I was slinging motorcycles. I had a full license. I had a shop, truck, trailers, a whole nine yards in high school. And I was doing that in college. And I got, I was on the KU water ski club team. Yes, there is such a thing as a water ski club team. We literally every afternoon went and water skied with fit college girls and bikinis. It was, it was, I joked around. It was, it was better than the football team having to

wrestle around a hot, sweaty dudes. So, and the guy who started the club team for KU, in the 70s was a commercial real estate guy in Kansas City and I got introduced to him. He's like, you got to quit slinging these like $2,500 deals. You got to start slinging the commercial. So I didn't go home over Christmas break my sophomore year and I went, drove in every day to Kansas City and got licensed and intern for him, slinging office space in college. And then that's what I did right out of college after I did eight months, solo around the world trip, came back to Kansas City. And I got all three, the big, Commercial firms were recruit me there.

Went with CB Richard Ellis, world's largest commercial real estate firm and said, I'm going to grind eight to five Monday to Friday and I'm going to pay myself $1,500 a month to live on. I'm going to house hack and I'm going to put everything else into buying real estate to essentially replace the farm ground that my dad lost because I still had that boulder on my shoulders. And I needed a net worth a million bucks by 30. And I had a short window to do that.

So in one word, how would you just, describe your overall strategy. Opportunistic, without a doubt. That's it. Ever since I was seven years old, opportunistic is you have an opportunity in fronty and you got to figure out a way to add value. So opportunistic value add. That's it.

Yeah. And so like a lot of investors, I know you used house hacking as a strategy early on, but that's not where it ended. So can you tell us about your first and most recent house hack? I've house hacked every house I've ever lived in. There was a short period when I moved to Denver. I was strategically in Kansas City.

I wanted to put my four years, had a certain goal to hit there, and then I was moving out and start my own firm in Denver. So there's a short window where I wasn't living in one of my kind of house hacks, but even that situation, the rental deal was kind of a house hack. But every year since 2006, I've house hacked and either bought a house, converted it from three bed to five bed and rented the rooms out 2006. I still own those first two house hacks because I didn't know about the two-year owner-occupant tax benefit at that time. Probably was a good thing because I still own those two houses.

They're about three or four years away from being fully paid off worth three, 400,000 apiece, producing $2,300 in rent each. But the goal back then was the house, you know. And I hate saying that like before house hacking was house hacking, but I was just needed a double mortgage. That was it. I had to have a house that I could get, figure out a way to double my mortgage and live for free. That was it. So I just back into that. And then once I got here in 2008 happened and there was a big discrepancy and the market was shifting and I was learning the value ad and I learned about the two year owner rock where you live in a house the last two of five years.

And if you're single, you can take up 250,000 tax free. You're married up 500,000. So I was like, game changer now going back. to the word opportunistic, I now found a new tool, my tool belt, to allow myself to see more opportunistic opportunities that come my way. So after that, I started just finding the best deal I could find and live in it for the two years and add as much value as I could. And I started buying rentals with the plan of moving into that rental, you know, in after my next two year to live there two years to be able to take that tax, tax free. And I ran the numbers.

for a banker a few months back. And the value from my 100% tax-free house hacking is a little over $1.9 million of tax-free income that I've got through all of my house hacks. Can you walk us through how that would be? What do you mean by tax-free? The first two, I added the equity into those. So those wouldn't quite be 100% tax-free. But after that, I lived in a house two years and I sold it and I essentially found a property, a project that I can make $250,000 on. And I live there for free and made $250. So I added up every house, what I bought it for, what I sold it for. And essentially, I'm happy to even share that Excel sheet with people if they're interested in seeing true, true real world, 2006 to 2003, what the power of house hacking in all aspects, roommate,

renting and living there can do. Yes, I am always prefaced that I went through a time period from 2010 to 2020 that we might not ever see that opportunity again. So I'm big believer in also sharing that like, you know, I have a little over 31 million of personal assets that I own just myself. And I have I'm invested as a syndicator, a partner in another, you know, 30 plus million between apartments and and different deals. So I could, it would have been really difficult for me to get to that number without a 2010 to 2020. I just, I'm, I know I'm sidetracking a little bit, but and I'm, it's just so many people

come out and share their story. I have 30 million in real estate. My goal was $2 million a real estate by the time I was 35, 10 houses that were worth 200 a piece that I bought for mid-hundreds. added value and I'd have two million. That would replicate what the that return of what my farm would we'd lost. So to have 30 million is beyond my wildest dreams. Yes, I've worked harder and probably anyone out there and sacrifice, but also the timing played a big part in that. So that 30 million, whether it's 2 million, 20 million, 200 million, I'm not big into the numbers of the

door count because I think that can skew people if that makes sense. No, that's wise. I say all the time, how much equity do you have your portfolio and how much cash flow are you making? Those are the numbers that matter, whether it's, I mean, wouldn't you, wouldn't each of you rather have one property that makes a whole bunch of money than 75 doors scattered amongst all these different areas that maybe make the same money, but it's 12 times as much work.

We often talk about the wrong metrics because it's the, it's, it's, it's, the title that people will click on. Oh, I want to learn how they got to 47 doors. And then you dig in deeper and it's like, oh, these are bad properties in rough areas and you don't even own all of them. You partnered with a bunch of other people on it. You didn't scale the 47 doors. You just created this headline that makes everyone feel bad about what they did versus someone like what you're describing here, Jason, you went through all these different asset classes. You got experience in many different ways of making money with real estate. You figured out eventually where your strengths are. You sort of made this like a business, like a job in a sense of making money through

real estate, not just this passive income dream that people have that frequently doesn't work out very well. You mentioned that you're your house hacking right now. What do you say to the people who think house hacking is beneath them? That's a beginner strategy and they want to go on to to cooler and better things. You know, this is kind of a, if anyone knows me, this is so far from how like a real statement, but let's go hop on my plane and fly over my recent house hack, you know, and, you know, and in like, kind of like a jerky way of like just responses, like, that house hacking has afforded me the life luxuries and the ability to give back and donate and travel the world and that quote financial freedom that I never could have had, you know, otherwise.

And I will keep doing house hacking almost probably to the day I die because it is such an impactful thing on myself. Now my wife, potential, you know, future family, whoever I donate all my wealth to or the building I put my name on, they will be impacted significantly because of house hacking. And adding value. You know, I'm a big believer in the value ad, you know, versus, but hacking is just a much simpler word. you know, a house hack, plane hack, hog hack, whatever it is. And so you're working on a house hack right now, or are you in a house hack? Tell us about that deal. Yeah, the recent one I, the last one I did was a brand new build duplex that I built

in the heart of Denver, right off Tennyson, bought the dirt for 515, built a duplex luxury, you know, high-end, three-story rooftop, downtown views, you know, of that. And I was going to live in one. And the other side was identical, just mirrored. So I was going to live in the first one for two years, take my 250 plus thousand I'd have since I built it myself, live in the next one, do that. I got one of those out of there. And then this winter, I had the opportunity from a developer to buy a 2.8 acre parcel in northwest Denver that had, and the zoning here allows me to subdivide that and build on one acre parcel. So the plan now is a 1991 original house.

Purchase for $2 million. The house itself is worth $1.4 to $1.6. A lot's worth $6 to $800. So in the process of subdividing the additional land down to 1 to 1.8 acres, I'm not sure how we'll divide it yet. And I'll either sell that and lower my basis or I will build over there, sell my current house. sell my current house and then go live in a brand new build custom duplex mountain views and the works um and house hack that for two years and the numbers on that will work out to where

are you going to completely subsidize your mortgage on that because it sounds like a premium property are you going to subsidize all of it or is it just meant to like get your overall monthly mortgage down as low as possible tbd up to this point i've never paid to live i've made money on every single since graduating college, I've never had a house or a mortgage payment or utility. All of that money has gone back into buying additional real estate that was income driven. This one was, I told my wife before we got married, we had three moves and I had those strategically planned. And after that, she got to decide that was 40.

and then she kind of helped make the decision. But up to that point, it was financially driven to allow us to have that, you know, quote financial freedom the rest of her life through these next moves. So the house that we have now is an in-between. TBD, what, it will financially make sense, but will I have, you know, will I hack it where I'm living for free TBD? You know, it's a $10,000 a month mortgage payment that's not covered by, The last duplex, the tenant next door, I rented it for $4,400 a month.

And my mortgage payment was like $5 or $52, I think. So they're almost paying for a, you know, most of it for a property who's valued at that time over $2 million. And I was essentially living for $800 a month. So TBD on this one. But not to go into the nuts and bolts of it. But it doesn't matter if it's your first house, your middle house, your move up home, your forever home, your vacation home. If you're willing to pull up your bootstraps and figure it out and go out and hustle,

there is a way, even in this market, a way to reach your goals. Yeah, I couldn't agree more. Well, you talked about making real estate decisions that let you sleep at night. And I know part of that for you is about partnerships. Why is it that you haven't really partnered much or gone in on the syndication side of things early on? Yeah, the syndication I saw at the beginning. I saw the guys doing it. Back in back when I was brokering commercial stuff, it was ticks.

Tenant in Common was a big thing. You can have an LLC with up the 36 owners and it's tax structured that way. So I got to see early 20s and the, you know, the, or when I was in my early 20s, that, that structure. And I saw the downside. An 08 when it happened, I had a gentleman that invested all of his retirement from Hawaii before the show. We were talking about, you know, some stuff happening in Hawaii. He called me once a week crying, older gentlemen, I'm guessing maybe 70s, crying, asking if there was any movement on this office building because all the tenants had vacated. And it was going into receivership and this tick was getting foreclosed on.

And that was his life. He was guaranteed 7% from this syndication company and 08 hit. And he was going to lose everything. And I was 20, early 20s and he was calling me up crying that. this, you know, this syndication company had, tick company had essentially lost everything. And that, that as a farm kid, the 4-H, the heart, the hand, all that. My goal is to add value and help others. It's not to get the fancy cars, the planes, all that. And I just, up to this point, I didn't feel confident enough in myself to go fake it until you make it, raise money, and get, have

other people's money. And I just couldn't, I couldn't have slept well. After seeing my dad lost the farm, having this gentleman call me once a week for six months crying. I chose to do it on my own. And I was stubborn. I just wanted to do it. I wanted to build a foundation that I could, no one could F with. So I just going to do it on my own. And now, you know, I'm raising capital for projects and doing partnerships and stuff. And essentially here on out, anything I do, I'll have a partner in. whether it's one of my, you know, additional real estate ventures, you know, property management company and that we have now is, you know, amazing partner that's, that's amazing in it and runs the day to day. And same with my new builds with Miles, partner in that. And at my farm,

we have a Lupat Landco. It's a hunting farm farming operation in Southern Kansas. That's one of my best friends growing up, partners with me in that. So now that I have the confidence I'm partnering, we'll see whether or not I go, you know, all in on the syndication and, you know, the open door or Grant Cardone type model. What are your thoughts on the rise in popularity with how many people that did not have your level of experience were starting funds, starting syndications, raising money from people going out and buying real estate while the market was climbing, climbing, climbing, and now interest rates have increased very quickly and quite a bit over a short period of time.

and we're starting to see some of those things getting exposed as bad deals. People are losing money. There's more capital calls. Do you think that's just a part of the process that you're going to have this happen? Or do you think as someone listening to a podcast like this who hears about all these groups making money that they should have a little bit of skepticism? I tread lightly because that's one reason I've been torn on social media. You know, I was helped do, you know, bigger pockets first office lease with Josh Storkin back in 2015. So I saw the podcast.

I saw the success, you know, he's happening. I got to know him on one-on-one basis. And I couldn't, because of my background, I have struggled really hard with all the groups raising money, to fake it until you make it. That's their pitch. When you sign up for one of the courses, say, invest a thousand bucks, and you have now, you're an investor in a thousand doors.

And I had anger. kind of bitterness towards all of that and that mentality and the rise of the success. And that's not what people want to hear, you know, they don't want to, they want to hear the success and all the positivity and how you can make your Bentley and your plane. They don't want to hear about it, a guy crying because he lost everything. He doesn't want to hear about the lawsuits. Bush development, I office with him, my first development or my first project here in Denver and Cherry Creek, 2012. And again, this, you know, going a little dark, but he's no longer with us.

He, you know, this guy had tens of hundreds of millions he had sold anyway. He went big and 2008 hit and he couldn't recover in 2012. You know, he's no longer around my office with that guy, you know. So there was, I saw the darkness and people don't want to hear that at all. So that's going back to like this story. I kind of got off a little tangent because it is, it means so much to me. If you can hear it my voice, you can see it. my face, like, it, it scares me. But that's not what people want to hear. So that's why I've

taken a little hiatus from, you know, adding value in social media and, and producing content because it does scare me. And I don't, I don't know what to say to that because people don't want to hear that. Well, that's why we're asking it, though, right? Because this is a really big podcast. A lot of people listen to this. And there's even people out there that will be featured in the Bigger Pockets world, they'll write blogs for them or they'll be active in the forums. And you get this impression like, oh, you're a bigger pockets person. You're safe. But BP can't look into every single one of their two million members that's out there. And it's very, very easy to just be like, oh, this is what I'm doing. And they make the videos and they show themselves in the fancy car and they

portray the image. But I think your avatar is much, much closer to what I see successful investors actually look like. They're usually not the Grant Cardone. flashy, look at my plane, look at my car. They're not what you see on Instagram making an edited real to raise money for something. They're boring. They're analytical. They look at what could go wrong. They're often driven just like you are, Jason, and just like I am by, I don't want to go back to being poor. I don't want to go back to having to, you know, not have freedom in my life. They look for what could go wrong in a deal and they're extra, extra careful. And that doesn't sell on Instagram, like you said. Nobody's on TikTok, follow.

following the boring person at all. And they don't want to, they, even in conversations, they don't want to hear that about that gentleman, you know, crying to me. They, they want to hear that if you do what I do, you can get your, your, your, your, your, your, your, and that's just not who I am at all. So I've, I've struggled with that because there are some awesome people out there that are doing great things and raising capital and expanding. And it's great. And that's, it's great. And That's where I want to stay positive and that's why I kind of like stayed behind the scenes and just kind of watch this bigger pockets versus doing the first, you know, helping with the first office lease.

Like could have jumped in and hey, we promote this. I want to do this. And I just put my head down and it's kind of what's what's kind of unique about this kind of surreal. Now it's, you know, this eight years later from negotiating, you know, May of 2015 and here I am and I'm kind of back in that. So I'm rambling a little bit, guys, because I hope you sense that, like, just it means something. It's an awkward conversation because you don't want to throw everybody under the bus, but at the same time, it is true. When I think of all the

multimillionaires I know in real estate, they're not people that want attention on themselves. They're really boring. Like, uh, sorry, give me, Brian Murray, who wrote the, um, crushing it in commercial real estate, I believe it is. Brian Love. you really nice guy not the most exciting dude he's a bit of a brand muffin and that's why he's the person that you probably want underwriting your deal and he's probably going to be extra careful so just everyone listening to this you heard it here doesn't mean if someone's flashy you shouldn't invest with them i would just be extra cautious i'd look into it deep don't underestimate the power of a really boring polo and new balance tennis shoes when you're looking to find

the partner that you want to get into in real estate day i i have to say that if you know one of my partners in our property managing company, he literally gives me hard time. I wear new balances and they're blue and they're blue. So he's like, dude, you literally are just coloring the fact that you are wearing white, old man new balances. I'm like, they're blue. They're hip. They're cool. And it's got a little like orange in the new balance. He goes, no. Though that's you're, that's just accept it, man. So this could not have worked out better. That's perfect. They're comfortable, guys. They're comfortable. They're, you know, they're, they're easy, you know, so there you go. Now, Jason, I understand you keep your properties relatively under leverage. You're at about 56% leverage.

What's your philosophy behind that? I don't want to lose a farm, man, you know, the fact that I even said in front of people that, you know, I bought a $2 million home and I have a $9,850 month mortgage payment. It's, it, it's against everything the farmer mentality is. You, you don't, You drive the more rough the truck is, the more probably wealthier the farmer is because, you know, that's just they don't care. And my leverage is just making sure that I don't lose it. So like hearing the number that I have a $2 million house and a $10,000 makes me anxious. It makes me sweat.

I know I can, it will ultimately make me money. But the fact that, you know, that's just not. where I come from. So I knew the guys during the 2010 to 2020 era were 100, 120% leverage. They were borrowing for the house. They were borrowing for the down payment and they were borrowing for the fix-up. And they were scaling, you know, and I bought my first house, 3852 next to a guy that was doing that, bought it out of foreclosure, borrowed 100% of everything, plus he had overhead for his staff. So he was over 100% leveraged. He is financially very wealthy at this point. But I just wasn't willing to take that risk and lose it all because of the bootstrap. I just wanted to get a little

better than I was the next day. And 80, 90, 100%, you know, scares me. But again, I'm not saying that's wrong. And that's where I want to, you know, I'm not saying to not invest in syndication. I'm not to trust people to not leverage 100. If in this market, you know, I'm not, you know, I'm not saying, there's a right opportunity, go for it. It was just my background and I knew who I was and how real estate would affect me negatively. Essentially, if that went wrong, it would affect me more negatively than if it went well, that it would affect me positively. The risk-reward ratio didn't make sense to go big.

Now, in the beginning of your career, it may make more sense to be a little riskier because you got less to lose, right? And you can kind of make up for mistakes with just grit, hustle, pouring yourself into it. But once you've got a bigger empire, so to speak, if you take your eye off the ball and it's super, super leverage and you're looking over here and that thing starts to topple and there's no way you can get out from under it, that's a very different scenario than when this is the only thing you're doing. That's what happened to my dad. You know, if he could have would have kept doing single family homes, keeping cattle, running them on our pasture, staying lean, you know, but he went big and it bit him. And he had, he had, you know, he had a lot to lose. So, and but again, Grant Cardone went all in. And here he is today, you know, so it's, it's, it's you choose who you want to be and what at the end of the day,

what will make you happy and things like that, you know, so. Yeah, I mean, we've already covered a lot of this, but I do want to move on to the ugly or the ugly truth, if you will. your no BS advice for investors. So really quickly, can you run us through three things investors listening to should do that no one else is going to tell them? Yeah. So the first is good old Craigslist, white pages, sending letters, the bare bone basics. Some unique ones that I get some leads on is I talk to cleaners and I go to open checkout garage sales and literally stop by garage sales. And because if I see all their stuff out, they're selling and they're there.

you literally get to talk to the person that's selling everything. Yeah, trying to clean house, right? Literally clean house. And that's what they say when you make a bunch of money. Man, I cleaned house on that deal. So Rob, like literally, like they're cleaning house. And if you add value and help their life by saying I'll buy the house, you know, as is.

If I'm a broker, I want to help broker it. Then they can get that deal. And a lot of times stuff like that. And then, you know, asking cleaners that are cleaning, hey, do you have a have any inside. I bought deals from them. I've talked to every UPS FedEx delivery driver I meet. I'll give them my information. I'll tell them, I'll give them a bonus if they ever come across inside of someone wanting to sell or move because they're literally delivering packages to these people daily. So got some deals through that. So again, all this is not scalable. With the cleaners,

is it like, are you telling them, hey, if you have any clients that have talked about cleaning in your presence, let me know, and I'll hit them up kind of thing? Yeah, it's literally cleaners are, they're coming, the houses are, they're dirty, they know what's happening, they have health situation. Most people will try and get lawyers and probate and all of that because they hear when family shifts in health is happening. But a lot of times cleaners are being sent in because it needs a family member, it's older, it needs cleaned, or they're moving and they're selling. It's just insight, literally. It's just they are literally in the house.

That's my whole goal is just finding value add information, opportunistic information, and a cleaner literally is in that person's house, just as a FedEx driver is, as the UPS coming to the front door. They're meeting those people. And what is your last tip for our listeners at home? Man, stress tests before you do anything. I know a lot of people say go all in and stuff, but at least what works for me is I'll stress tests a little bit.

I'll go and door knock or I'll call or I'll deal with some tenant issues or I'll help go renovate a friend's house or something to like see, okay, am I actually going to do I enjoy fix and flipping? Do I enjoy picking out colors and stuff? Like before you go buy a fix and flip, just find someone a friend that needs some renovation and help them. Figure if you find a passion for that. But so many people will buy a fix and flip. they'll realize, oh my God, this is, I hate this. This is terrible. This house is disgusting and I don't like this. I want to be a broker. I want a flashiness. So then they'll switch to brokering. So stress test before you jump in. And there's always a way to stress test almost everything.

That's awesome. I mean, I'd second that advice to anyone who wants to get into real estate investing. It's so common that people don't want to do anything unless they get paid. But just get in there and figure out if you like it. Quit worrying about getting paid per hour. Try to figure out if this is something you're good at, you enjoy. You're going to make a lot more money in the future because you took that path. So if you think you might want to be in property management, ask a friend who's managing their own properties if you can help with what they're doing. Find another person and say, let me manage the cleaners for you and see if that's a thing you enjoy doing or if you absolutely hate it.

There's lots of jobs in the real estate space that people could get into that are better than the job they have now. They don't have to just try to live off the cash flow. And I'm frequently encouraging people to jump in and see if they like something. So I think that's a really good advice. I also like your idea of playing defensively. I refer to this as building a financial fortress. It's not always about scaling and getting bigger and bragging at the next meetup you go to because of how many doors you have. It's often about building something that you're not going to lose, that over time is going to be a solid investment that's going to take care of your future.

And like you saw it with your dad, when you grow too big, you can absolutely lose money. So I think that this is great advice. Rob, anything you want to add? No, I actually have. like the cleaning one. The garage sale one I can speak to. I went to an estate sale and I was leaving and I saw someone behind the desk by the door and I was like, hey, by any chance, are you the owner? And she was like, well, yes, I am. And I'm like, would you be, are you looking to sell the property? What do you want to do with it? And I mean, I was a little bit more tactful than that.

But she was basically was like, yes, I am. And I was like, would you be interested in selling it off market? Like, I'd love to buy it from me. I live in this neighborhood. And she was like, yeah, I would totally be interested in that. So I got an information. I called her. It didn't work out. It's all good, though. It just gave me the idea, though, that when you can meet someone face to face in the moment when they were trying to offload a property, it can actually make closing that deal a lot easier. That was just one scenario for me, but I knew from that moment, if I went to 100 garage sales, the likelihood of me meeting all those owners and closing a sale or a deal or two from that, probably pretty high.

100%. If you went to a garage sale, estate sale, I'm a big fan of the garage sale. and finding the older because they estate sale, they're already in action. They're probably already got a broker. They're already selling the house. It's already sold and they're needing to liquidate everything within two weeks. So I'm big fan in the garage sale. But if you did that 100, you would get something. You send 100 letters.

You'll get a response. I like the basics. I'm a huge fan. Yeah. It's a numbers game. You just have to be willing to do it. Bootstrap. The very beginning we talked about it.

Bootstraps. Pull them up. Boom. Full circle. All right. Well, thank you, Jason. This has been really good information, and thank you for sharing your story from 4H stud to real estate investing connoisseur, who's got all kinds of different assets and all kinds of different places. Where can people find out more about you if they want to follow up? Yeah, kind of, I'm going into my journey at this point, and I'm wanting to help people and get the message out there and just add values.

So I've kind of doubled down and everything I have is Journey with J-L-E-W. So Journey with, J-L-E-W. So Journey with Jay Lou on any social media, LinkedIn, Facebook, you know, whatever. And you won't see a ton of activity here in the past. But hopefully we'll get that going. And also have the creative real estate podcast was one we've done there in the past that we're getting going again. Nice. Rob, where can people find out about you? You can find me on Instagram and YouTube at Rob Built.

YouTube is where I post my long form content that teaches you how to do the real estate thing. And then the short form, goofy real estate content is all on Instagram, baby. What about you? You can find me at David Green24.com or David Green 24 at your favorite social media. Thank you, Jason. It was great meeting you and getting me here about your life. And thank you for your transparency about New Balance Shoes. It's tough to go on a podcast that gets 300,000 downloads and very vulnerable for sure.

Yes, very much so. But we appreciate your transparency. New Balance and mullet wigs. Love them. We'll let you get out of here, Jason. This is David Green for Rob all day I dream about sales, Iva Solo. Signing out. Thank you all for listening to the Bigger Pockets Real Estate podcast.

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