From Crushing Debt to Renting Out Billy Joel’s Former Estate—How Ben Chester Turned It All Around

In This Article

Name
Ben Chester

Location
New York City

Occupation
Tech sales and real estate investor

Assets
Eight properties, three short-term rentals (including Billy Joel’s former Hudson River estate)

Investment strategy
Short-term rentals and house hacking

Financing
Conventional loans

In 2012, Ben Chester was making $30,000 a year in New York City, spending every dollar on rent. Frustrated, he decided to secretly move into the sleep clinic where he worked, subletting his apartment on Craigslist to cover the lease.

That hustle eventually turned into a furnished-rental business that attracted venture capital, grew quickly, and then collapsed, leaving Ben with $120,000 in personally guaranteed debt.

Ben got a W-2 job, rented a one-bedroom apartment with his girlfriend and three roommates to cover housing costs, and pointed every spare dollar at digging out of debt. Finally, a few years later, he bought his first co-op in Hell’s Kitchen.

Today, Ben owns eight properties across New York, offsets nearly all of his W-2 income through real estate depreciation, and even hosts guests at Billy Joel’s former Hudson River estate. Here’s how he did it.

You were $120,000 in debt with no savings. How did you get your first deal done?

I combined a travel-heavy W-2 job with aggressive saving. When you’re on the road, and the company covers hotels and meals, your expenses basically disappear.

I stacked everything I could toward a down payment, found a one-bedroom co-op in Hell’s Kitchen for around $500,000, moved in with my girlfriend and my brother, and kept housing costs to about $750 each. The mortgage principal was roughly the same amount, so I was essentially breaking even while building equity.

That was the whole point: I wasn’t trying to get rich on the first deal. I just needed to lock in a foothold in New York.

How do you make the numbers work in one of the most expensive markets in the country?

The strategy that changed everything was the short-term rental tax loophole. If you have a W-2 job and you self-manage your Airbnb, you can apply the property’s losses, including depreciation and bonus depreciation, directly against your W-2 income.

I maxed out the $305,000 annual limit every year and carried the excess forward. On Billy Joel’s house alone, I bought it for $2 million, put $300,000 into the rehab using 0% intro APR business credit cards, and generated close to $1 million in tax savings that carry over for years. The tax benefit alone made the deal work, independent of the cash flow.

What’s the one thing most investors in expensive markets get wrong?

They assume the market is the problem. It’s not. Every deal lives in its own vacuum. If it pencils out, it makes sense regardless of the ZIP code.

In New York, you have to be creative. You’re not going to find a cookie-cutter BRRRR. But you can find a one-bedroom co-op with something wrong with it, house hack it with roommates, and break even while building equity in one of the most valuable real estate markets in the world.

Stop waiting for the perfect market and start looking for the deal that works inside the one you’re already in.