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Thoughts on DLP housing fund

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  • wonderwoman77
    replied
    Still unclear ...does that mean the first 6% is not taxed?

    Leave a comment:


  • Hoopoe
    replied
    Originally posted by MK$ View Post
    Can someone explain to me how the pass through depreciation works? Can I use it to offset the 6% return? What makes this form of REIT different from others where depreciation option does not exist.

    Thank you!
    Supposedly pass through depreciation shields the 6% return. The other 6% or so if it performs is equity and may be taxed at capital gains rates when sold.

    Leave a comment:


  • MK$
    replied
    Can someone explain to me how the pass through depreciation works? Can I use it to offset the 6% return? What makes this form of REIT different from others where depreciation option does not exist.

    Thank you!

    Leave a comment:


  • Hoopoe
    replied
    I made a big investment (for me) and I can at least say they are very professional and responsive and and paying the first few 6% (0.5% monthly) distributions as promised. I think that the fees are a mixed bag compared to competition but acceptable overall. I sort of see it as a low fee lower risk fund to generate 6% with less volatility than stocks, more moderate fees from 6-12% but still in line with industry standard. Their 60/40 split above 12% is high and quickly caps returns much above that but I saw it as a price to pay for their evergreen structure and the nice potential “dividend” structure of the 6% return paid out monthly. Also, if a company can reliably deliver compounded 12% anual returns for me I’ll be rich and don’t mind if they get rich in the process. I also see it as a great fixed income product that can be reinvested in the growth stage of your career and then kicks off tax free dividends at 6% late in career which is excellent.

    Curious to hear what others say as well. I’m invested in another fund and also have done a few individual property syndications too and my portfolio is about 60% stocks, 35% syndicated real estate and 5% cash and equity in our physician group.

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  • DDSNick
    replied
    I’m also very interested in the DLP housing fund. I agree with your perspective on the fund.
    How would you invest in the fund? I don’t think I can establish a self directed IRA/401K because of my situation but I have a brokerage account. From prior reading it seems that using a brokerage account for the DLP housing fund is a good option considering the tax efficient nature.

    Leave a comment:


  • Jtlax
    started a topic Thoughts on DLP housing fund

    Thoughts on DLP housing fund

    I am interested in the DLP housing fund. Having listened to several of the interviews with Jim, and read through their documents, including the PPM, this is a very intriguing investment. For those who are invested or considering investing in this fund, what are your thoughts. From my perspective here are some of the pros/cons that I see.

    Pros:
    -equity investment, allows for pass through depreciation. Tax efficient
    -Fund structure allows for diversification, with downside protection
    -Evergreen structure allows for yearly liquidity
    -reinvestment of distributions if so desired
    -composite tax return... you don't have to file with individual states
    -6% preferred return paid before 1.5% management fee


    Cons:
    -1 year of data on the fund. It is a fairly new structure
    -large initial investment (could be good or bad)
    - 60:40 split (investor:member) after 12% is less than some other syndications

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