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Nick Huber Profile picture
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7 Dec, 4 tweets, 1 min read
The reason large companies use most of our tax credits and deductions:

Small business owners like us don’t apply for them and don’t know they exist.

Don’t listen to this guy, spread the word and learn the tax code!

It is created to encourage certain behavior. Utilize it!
I don’t mind paying taxes at all.

I’ll pay $250k in property taxes in 2021. A ton of payroll taxes and transfer taxes and mortgage taxes and sales tax.
But the government incentivizes what I do to add value to the world (buy and improve physical structures in our country) so I won’t pay income tax.

And I’m not ashamed!
Also - what do you think I do with the money I save on income taxes?

Upgrade my 5 yr old caravan? No chance. The thing runs great.

I do what Uncle Sam wants me to do...

Buy and improve more real estate.

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More from @sweatystartup

Nick Huber Profile picture
7 Dec
I just had a conversation with a friend who has purchased and developed 10+ buildings over the past 5 yrs.

Hadn’t done a cost seg or accelerated depreciation on any.

He’s looking at a $200k+ tax refund soon.

Cares act allows you to go back and get that money!
Get on @1245consulting’s schedule and talk to @baldridgecpa about a better tax plan!!

A lot of folks are missing out on the best part of being in the real estate world!
Here’s how it works for those interested.

Read 4 tweets
Nick Huber Profile picture
5 Dec
I decided this morning I wanted to put together a basic "crash course in real estate" guide. Something I'd have loved to read when I was 22 getting started.

7 hours later and I'm 19 pages and 7,500 words in.

Take away my character limit and all hell breaks loose!
And the wife is upset we didn't do our normal Saturday walk and she got no help putting the boys down for their naps.

"When you're in the zone you just gotta let it ride, honey."
First four pages for anyone who cares ImageImageImageImage
Read 17 tweets
Nick Huber Profile picture
5 Dec
There are probably 50,000 small mismanaged self storage facilities in the USA.

Too small for REITs, too small for institutional investors, too big and scary for single family investors.

Thats a perfect storm in my book!
My 10 year plan:

Buy 100+ of these at an 8-9 cap for $100,00,000. Make sure I own at least 50% of the upside.

Group them together with management co. Increase NOI to $10,000,000.

Sell to institutional investor at a 5.75 cap.

Sit on beach.
How I find deals:

Loopnet, Crexi, ListSelfStorage, Broker outreach, cold calling owners.
Read 7 tweets
Nick Huber Profile picture
5 Dec
You hear this all the time...

But I hate the traditional GP / LP structure and it doesn’t align interests at all.

Most LPs like long term holds, passive cashflow and hate taxes.

In most structures, GPs are motivated to SELL because it’s the only way to hit promotes.
And the risk free return rate (bonds, etc) has evaporated over the past 10 years but prefs are still 8+ because of “market”.

Do you know any good sponsors who aren’t oversubscribed?

RAISE YOUR PRICES FOLKS

And make a long term hold worth it for you so everyone wins!
Because sponsors who buy and sell and trade to make money aren’t real estate owners.

They are service business operators.

TIME should be making you money, not doing more and more deals and more and more work.
Read 5 tweets
Nick Huber Profile picture
4 Dec
A thread on how real estate investors, developers and operators can make millions a year and pay almost nothing in TAXES by using a little tax loophole called BONUS DEPRECIATION...

How it works 👇👇👇
Depreciation is the act of slowly, over time, deducting the initial expense of an asset against your taxable income. Generally over a 27.5 (residential) or 39 (commercial) yr time frame. So each year you can write off 2-3.6% of the purchase price against your income.
Thats a big deal. We're buying a new property, a $3MM self storage facility. Thats a $60k a year write off against about $260k in NOI and 200k in cashflow on a $3MM deal.

It makes 30% of our cashflow tax free.

Very powerful but there is much more to it...
Read 19 tweets
Nick Huber Profile picture
2 Dec
The holy grail of real estate investing is the cash-out-refinance.

I completed one in Nov of 2019 and $2MM of tax free cash was put into my checking account at closing.

Heres a thread on how it works, how folks make it happen, how to plan for it and the risks. 👇👇👇
Commercial real estate isn't valued like residential homes.

Residential homes are about comparable sales. What did the house down the street with similar features sell for?

Commercial real estate is valued, mainly, on one factor:

Net Operating Income (NOI)
The more money it makes, the more its worth. The less it makes, the less its worth.

Banks lend based on two things:

Its appraised value and its cashflow.

Appraisers value buildings based on CAP rate comparisons...

Heres how that works:
Read 16 tweets

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