Advice on current market

[Jemma Jacques]

Hi there, wondering if someone can help me, I sold a property recently and put the profits into a 1031 exchange, my goal was to buy three more cash flowing properties but then last week I was let go from my job of 20 years so the interest rates have gone up so much the properties don't cash flow anymore.

I was going to take out the money and take the tax hit (Im in CA so it is so much money) I only have a few more days to decide but I was thinking about investing it into a DST instead... any thoughts on this? would this be crazy in the current environment?
Any advice appreciated

[Dave Foster]

@Jemma Jacques. I appreciate you reaching out via pm on this as well.  Two additional things come to mind after reading this post.  

1. CA - Of course you would live in the worst state for taxation should you decide to pay the tax :(  You're looking to pay 30% - 40% of your profit to the IRS.  Of course, that being said, no one ever went broke paying tax on profit.  But dat's a heap.

2. Loss of job.  If you lived anywhere but CA it would be even more tempting to simply pay the tax and conserve cash for any extended period of unemployment.  But again, if you can find a dst that can provide a decent return you'll not only keep all of your capital and tax, you'll also have cash flow that can help you weather this period.  And a dst is one of the few options to you where you won't have to qualify for the debt (other than normal accreditation).