Like lemmings jumping off a cliff into the sea, Oregon Senate Democrats in pretty much a straight party line vote approved a proposal for the “first-of-its-kind statewide rent control policy (Senate Bill 608), as well as new restrictions on evictions.” Landlords can count on the fact that social justice warrior in chief Tina Kotek will give it a warm reception in the house. If the putative socialists who now control all branches of Oregon government can’t take your property itself, they will certainly appropriate everything around it.
This unremitting war on landlords should give all rental housing owners pause. Up and down the West Coast landlord property rights are under attack by the government class. These self-appointed and self-important interpreters of the people’s will are shouting at the top of their lungs, “Run away, run away!” And this is exactly what people with money are doing.
A February 4th article in the Wall Street Journal (WSJ) documents the movement of high net worth individuals and big earners “bolting to low tax states.” This includes rental property owners as a bi-coastal blue wave inundates the real estate industry. State legislators dominated by radicalized grass roots Democrats are now attempting to deal the real estate industry a serious blow.
Whether it is amending the state constitution in California to increase commercial real estate taxes or “taking the playground back” in New York, real estate and the people who own it are under attack. Instead of being lionized as great builders or exceptional savers, they are uniformly vilified as exploiters of the weak and homeless. This is more than a bit ironic given that all these individuals and organizations are in the business of providing housing.
However, being at war with capital and capitalists is part and parcel of Socialist dogma. If you’re not part of the congregation, you’d better leave the church. Fortunately, DST properties can do just this for savvy real estate investors. It provides them with a turn key vehicle to flee the overtaxed and overregulated coastal regions for the pro-business, pro-growth sunbelt.
It isn’t an accident that the majority of DST programs/properties currently available are in the “smile states.” This is the crescent which extends across the southeast and southwest. It is anchored in the east by Florida, a no income tax state and Texas in the west, also a no income tax state.
In an April 24, 2018 WSJ article, the famous economist Arthur Laffer estimates that over the next three years both California and New York will lose on net about 800,000 residents to states like Texas and Florida. Furthermore, this could translate into these two states gaining a net $50 billion in income and purchasing power status while California, New York and other high tax blue states lose this much or more.
Why on earth then as rental property owners would blue state landlords not take advantage of this red state economic Tsunami? Using Delaware Statutory Trust format, investors avail themselves of institutional quality property management. You are not the Lone Ranger trying to select and manage assets in an area of the country you know little about. A professional acquisition/management team: identifies potential properties, performs the necessary due diligence, manages them for investors and ultimately sells
them. Your only responsibility is to make your monthly trip to the bank to pick up you check. What are waiting for? Things aren’t going to get better any time soon for the landlord class on the left coast!