Madrona Financial talks to Realogics Sotheby's about DST's

Brian Evans of Madrona Financial joined brokers from Realogics Sotheby's International Realty to discuss DST's and how we can help our clients that may have aggravating rental properties. 

 

This week we had the pleasure of Brian Evans and some employers from Madrona Financial to speak to brokers about an innovative way we can help our clients. 

The topic was all about DST's. DST's (Delaware Statuary Trusts) are an investment vehicle for accredited investors who want the benefits of owning real estate without becoming a “landlord”, as well as current real estate investors who no longer want the responsibilities associated with active property management. 

If you've said something like this in the last couple of months, this could be for you:

  • "I'm tired of being a landlord."
  • "I'm no longer using my property and want to forget about maintaining it."
  • "I want to sell, but I don't want another property and DON'T want to pay the taxes."
  • "I cringe when I receive a phone call. Is the roof leaking? Tenant moving out again? Midnight plumbing problem?"

The problem?

Clients bought rental real estate YEARS and YEARS ago. This can be a great strategy to build wealth for someone in their earlier years of investing. The problem is that they may want to be retired now, but own these now very old houses needing a lot of maintenance and time. 

“Owning actively managed real estate is best for a season of your life, but not for the duration of your life.”

— Brian Evans, CPA, PFS, Owner of Madrona Financial Services

Another problem is that they don't want to pay sales tax and feel they "can't get out" of the property without it resulting in some sort of a loss.

Brian of Madrona Financial also brought up an example that a lot of the landlords aren't even NETTING any income, once they really do the math. Why would they still want to own these properties that have appreciated so much? What can they do?

The Solution?

Clients can sell the property and diversify geographically by investing into several different DSTs in different areas of the country offered by different DST providers.  The income from the sale would be put into into multi-family apartments, medical office buildings, self-storage or retail with positive appreciation. And most of the time, you'll be netting more than your rentals, WITHOUT the hassle of maintenance.

Did I mention, this is tax free?!

The real advantage for our clients is that it allows them to TRULY retire and get on with their life. No more worrying about the property. No more carrying toilets. No more debt. 

As a broker, we help the clients with the sale of the property and then Brian starts working with them to plan the investment side. This is a huge opportunity and a big way we can help our clients get on with their life.

Of course, there's more that goes into this, but if we have clients that are in the situation where they own multiple properties as rentals, hate dealing with them, aren't netting any income from them, and want a profitable solution, this is it. 

The engaging speech ended with wine, Hors d'oeuvre, and more networking/questions. 

Until next time!

Have a question? Feel free to email me and I'd be happy to point you in the right direction.

Austin Schneider | Realogics Sotheby's International Realty | austin.schneider@rsir.com | 206.910.234



About Madrona Financial

Madrona Financial Services was founded in 1999 to provide financial expertise that is thorough, transparent and unique, while acting in their clients’ best interest as a fiduciary. This fiduciary capacity is not new to our CEO and Chief Investment Officer, Brian Evans, as he has met this standard since beginning his professional career as a CPA more than 30 years ago. Today, Madrona and our wholly-owned sister company Bauer Evans, Inc. P.S. have grown to include over 30 support staff working together to help you invest in your future, simplify your life and prosper. This is The Madrona Way and this is why we exist.

The process behind the Madrona Way begins with our proprietary global asset allocation strategy, which actively evaluates securities based on anticipated profit per dollar invested. By analyzing and researching vast amounts of reports and data, including the consensus estimates of approximately 670 analysts, we create sophisticated and diversified portfolios that factor in debt, price-to-earnings ratios and expected growth of earnings, which we use to advise you how to best achieve your financial goals.