What To Know About Refinancing DST Properties
Many investors have recognized the benefits of Delaware Statutory Trusts (DSTs), making these investment vehicles very popular today. From tax-deferral benefits to passive income, DSTs have many advantages that make them suitable for those near retirement and those who want hands-off involvement in their assets.
Understanding DSTs as an Alternative Real Estate Investment
Investors have plenty of options when it comes to alternative investments, with different vehicles offering varying combinations of growth potential, risk management, and diversification. REITs, private equity, and hedge funds are commonly used strategies—but one structure with specific real estate applications is the Delaware Statutory Trusts (DSTs).
Can DST Investments Be Liquidated Early?
Joining a Delaware Statutory Trust (DST) can offer passive exposure to real estate and potential capital gains tax deferral when used in conjunction with a 1031 exchange. For some investors, there’s always the lingering question regarding liquidity, or your ability to exit the investment and cash out. Can DST investments be liquidated early? The answer is more nuanced than a simple yes or no. While most DSTs are liquidated only after the end of the holding period, there are certain scenarios when early liquidity can happen.
Can DSTs Replace Traditional Real Estate Ownership?
As you become a more experienced investor, you may encounter more advanced strategies and vehicles such as the Delaware Statutory Trust (DST). This vehicle may offer features that differ from those found in portfolios composed solely of directly owned real estate. This leads to the question: Can DSTs replace traditional real estate ownership? The answer is more complex than a simple yes or no. Below, Realized 1031 has shared an insightful article discussing the nuances. Keep reading to learn more.
How DSTs Can Complement a Traditional Real Estate Portfolio
Real estate remains a widely used investment option due to its perceived relative stability and the range of market sectors available. However, many investors maintain portfolios made up primarily of traditional, directly owned real estate. This concentration can introduce increased risk exposure and often requires ongoing, active management. For those seeking broader diversification or reduced management demands, alternative structures may be worth considering.
DST Market Trends Advisors Should Watch
Delaware Statutory Trusts (DSTs) are playing a growing role in tax-deferred real estate strategies.. While DSTs have long been used in 1031 exchanges, market forces are shaping new dynamics that are influencing how advisors and investors evaluate these structures.
