All Forum Posts by: Amit M.

@Jon Taylor I appreciate your input and perspectives on DSTs. Here is what I’m wondering: historically how have DSTs fared during down markets vs up markets. I’d like to know what percent of DSTs formed and marketed during say 2007-09 (pre Great Recession) made a decent return vs DSTs formed during 2014-18 (boom times). Do you have any sources or info to try and ascertain that? Remember folks, were likely entering some sort of recessionary or contracting economy, so having that data that would be telling!

Or you could get several helocs. They give you a lot of flexibility w/o committing to a monthly payment unless you use them. Given how absolutely bonkers the world is now*, having ready money on the sidelines isn’t a bad thing imo :) 

*ohh, just Covid remnants, Ukraine war potential spillover, interest rate hikes, high national debt, climate change effects, red-blue state tensions, market high real estate, stock market uncertainty.  Lots of tinder around to light the sh!thouse on fire imo in the next few years. Hard for me to see how we navigate all that unscathed (and there’s more- rampant social media misinformation, bitcoin, US dollar as reserve in question, China autocracy, and of course there’s still the Middle East…and oil.)

So if something big happens you have the option to cower and cover your head, knowing you have access to more emergency heloc funds, or go big and bold and make new investments in unprecedented times. 
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my2c

@Kenneth LaVoie I'd be careful of NNN properties. Cap rates are really low (compressed) now, so you're really paying a premium. Rates are going up. What happens when you want to sell it later and rates are higher? (Property value will go down, as you're getting a lower rate now.) And yes, if you get a vacancy, it can kill your cash flow for a long time. Especially at $1.4 mil, you're not getting prime NNN. Plus all the changes in retail going on. Lots of risk imo.

I recently excited some properties I didn’t want to manage anymore, and ultimately decided to pay the cap gains. I used the profits to pay off existing loans on prime properties I do want to hold(er) term. I’d rather rid myself of a 4% payment, then risk getting into another property where I still have to deal with loans.

Yeah paying cap gains has a cost, but we’re at top of market now, and rates are guaranteed to go up soon. I’d think of the risk side very carefully now, as I believe we’re going into an economic cycle that’s going to hurt a lot of current RE investors. Will it be excessive inflation? A recession (deflation)? Or (hopefully not) worse of both, stagflation!

Good luck and let us know what you decide to do.

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my2c

@Dennis L. I think you’ll get a lot out of reading this thread

https://www.biggerpockets.com/...

Aren't DST's essentially syndication deals, but with much lower returns (though they do accommodate 1031 exchanges)? So essentially you're saving on capital gains, but getting lower returns for that capability.
Tomato tomāto?

  quick tip: Check out 1670 Kirkwood Ave, SF. It’s a great house hack option, per the listing info on it. 

Or, you may want to house hack something easier to manage while still generating income. Look at 1670 Kirkwood Ave in SF

@Carlos Ptriawan that’s interesting. Can you provide a link or reference?

@David Mayman yes that is correct...I was going to tell you (but you beat me to it) to look up previous cases where the “temporary rent discount” was challenged, as I knew it failed in SF. Curious, did you see any other similar cases in other CA rent controlled jurisdictions?

@Carlos Ptriawan yes I agree. Especially these last few years with interest rates being so low for so long, every decent asset class has seen cap rate compression for several years. Which is why paying down debt seems especially compelling these days.