Delaware Statutory Trust

Selling an Investment Property and Avoiding Capital Gains Tax, while Still Earning Income

For real estate investors who are considering the sale of an investment property, a 1031 exchange is a common tool that allows the seller to reinvest the proceeds from their sale into the new purchase of an investment property and avoid paying capital gains tax. But what happens when you're tired of managing properties, and ready to slow down and enjoy life? If you sell said properties you're looking at a hefty capital gains fee, which cuts down a lot of peoples retirement funds. Well that's where a lesser known option has been hiding all along, The Delaware Statutory Trust, or DST. Now I will say, I am by no means an expert or financial professional in anyway, I just take meetings with experts who are very well versed in their fields and I take notes! So please, contact your financial advisor to get detailed information on exactly what investments are right for you, now back to your regularly scheduled newsletter. A DST is an ownership structure for real estate-related 1031 exchanges in which investors each hold an undivided beneficial interest in the real estate trust. “Beneficial interest” means each investor within the trust holds a percentage of the real estate assets

within the DST. Like every investment opportunity, there are pros and cons to a DST. For example, you have less control when comparing them to traditional real estate investments, and DST investment are considered illiquid because of the lengthy timeframe they take to change hands. DST investments typically have a term of 4-7 years and potential average returns around 5% when invested in more traditional assets such as Amazon Warehouses, and can show potential returns closer to 10% with less traditional assets such as oil or mineral leases. Again, DST investments are not bullet proof, they are subject to the market just like every other real estate investment, but I do believe they can be a good option if you're looking to cash out of your current rentals, want to avoid capital gains, and still make passive income into the future, then a DST might be a great option for you.

• New listings jumped dramatically from 67 last week, up to 68 this week.

• Pending properties also increased seven spots this week to 45.

• 18 properties closed escrow this week, compared to 32 that closed last week.

110 First Ave, Blue Lake CA | $569,999 - 2bd/ba - 1196sf - 0.19 acres

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