Dan Novaes explains that ultra-wealthy investors typically use private equity real estate (boutique funds, commercial deals) rather than owning/renting single properties. He outlines the play: invest as a limited partner in multifamily, retail, mixed-use or commercial deals to receive passive cash flow (monthly/quarterly), long-term appreciation, and tax benefits—notably on-paper depreciation that can offset other income. The piece is promotional and urges viewers to follow for more tips.
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Everyone talks about real estate investing, but the ultra wealthy rarely flip houses or manage Airbnbs. Instead, they invest in private equity real estate deals that generate cash flow, grow in value and come with massive tax benefits that most people don't even know exist. The 1% want three things from their investments. Predictable cash flow, long term appreciation and tax efficiency. Especially that last part. Private deals like boutique funds or commercial properties can offer all three. No Wall street volatility, no tenants, no three day maintenance calls. The idea here is that bas get all the benefits of being able to prosper from buying properties without all the hassles that also are undertaken when you buy a property and rent it out to others. The thing is that you're paying a company to do this for you and you are just investing in a fund. So here's how the play works. You invest in a private deal. It could be multi family, it could be retail, it could be mixed use, it could be commercial real estate. Depending on the real estate deal that you choose, you become a limited partner, which means no day to day management. You get paid monthly or quarterly and depends on the terms of what ultimately the fund has. But the benefit here is that you get to receive the depreciation losses on paper which can offset other income and reduce your tax bill. Sick of wasting all this money? Follow us and get all of our hacks for free.