Real Estate Investor Tips
If you’re currently a real estate investor, or you want to become one, you know that the life of an investor can be a great one, but it can also be a roller coaster. That is why our team at Diversified Investment Strategies was formed! We are a team of reliable, experienced professionals here to answer your questions and guide you through investment assistance. We specialize in 1031 exchanges, which allow investors to sell investment real estate assets and defer taxation on the sale.
To succeed in real estate investing, you need to capitalize on opportunities, minimize mistakes and thrive in diligence, among other things. Here are three common mistakes that investors make, according to RISMedia, and how you avoid them:
1. Investors don’t pay enough attention to people. Most real estate investors view the properties they acquire as their greatest asset. After all, the perfect property deal could change the course of your life. There are few investment opportunities out there as great as the return on investment real estate is capable of. However, the greatest intangible asset to invest in is people. Who you choose to work with will determine the types of deals you find out about down the road.
2. Investors fail to have a backup plan. Investing in real estate is contingent on many things falling into place in a set amount of time. The 45-day ID goes quickly in a 1031 exchange. If an investor is running out of time on their 45 days, or they can’t find an exchange property in time, can’t get a loan, or problems arise from an inspection, our team at DIS can help by using a DST or other investment option! For example, if you go over your 45-day ID, but have identified a DST, then we can use the DST as a backup. The DST can be an insurance policy against paying capital gains.
3. Investors scale their business before they’re ready. Our team at DIS specializes in helping real estate investors’ trade up for investment properties that can yield better income or that make more sense for current life situations. We love helping investors climb the ladder and grow in profit! However, we also realize there is a time and place for doing so. It is possible to expand your bottom line with every property closed on, but there is also the possibility of expanding beyond your means. If you’re not sure when the right time is to move up or to trade in, allow us to help you.
Delaware Statutory Trusts, or DSTs, are one of the most popular 1031 exchange options, which allow landlords the opportunity to relieve themselves of property management duties. A DST investor owns a portion of a trust, called a Beneficial Ownership interest. There are multiple DST owners and each own a percentage of the trust. Aside from no more property management, other benefits may include higher monthly “tax sheltered” cash flow potential, greater capital investment appreciation potential, tax benefits, short holding periods on property ownership and more. Learn more about DSTs and other 1031 exchange investment options.
Give our team at Diversified Investment Strategies a call! When looking to complete a 1031 exchange, and defer federal taxes on your investment properties, we’re here for you! We want to see you exceed, and that takes diligence, minimalized mistakes and capitalization on the right opportunities.
Bryan Hakola
Diversified Investment Strategies
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