The Fed is not making it a secret that after printing up all the money that it has, that it is more focused on the economy than holding down inflation.

As I have been trying to make the leap up to the NNN world, I am seeing how many investors appear to be using debt as a hedge against inflation.

The thought process is if the value of the dollar falls, it would be best to lock in money and then have inflation eat it away.

Any thoughts?

I am seeing NNN investments that are all seven and eight figures lasting mere days on the market place. I might end up having to buy something that isn't even built yet

What about the possibility of using REIT's ?

Some things I like about them:

You can sell with a phone call.

No waiting to sell if something happens or the market turns.

They are available for many types of properties.

Pro's that work there choose properties.

Many properties in their portfolio's.

They manage them.

Low or no minimums to participate.

You can spread your money over several different types of real estate.

If you've ever done extensive research on REIT's, TIC's and other forms of "group" investing, you would come across a lot of fraud and mismanagement.

Most Sponsors of these forms of investment "claim" they will hold a position as an investor and will do their best to protect investors ( and themselves) against loss! This is a bucket load of dog doo.

The Sponsor's take their 1 spot and sell out $25,000 blocks for others wanting to park some retirement money. At the end of the day most Sponsor's sell out their shares to have more money to create another "investment".

One Sponsor had over 100 such projects. The goal was to hold each one for 5 years then sell out -- giving profit to each share holder in the TIC or REIT. But with the original costs, fee's, commission and up front profit, it took over 5 years just to break even and another 5 years to show profit. Most real estate cycles last between 5 to 15 years. So there was a good chance that after enough time passed to produce profit via equity, the market would crash again and the investor would be left with "0" profit..

Interesting. I need to follow this.

Well since I am doing a 1031, REIT are not an option. There is a twist to these though - DSTs. These trust typically over state the value of the asset that they are selling fractional ownership on.

Some of these are self storage units which make sense as a niche. Others niches, I just can't figure out. I am told there is a really nice hotel across the street from a hospital in downtown Detroit. It sounds rather risky and it paid a whopping 5.5% Cap Rate.

I think debt is the way to go if you're in this for the long haul. To borrow now at almost always less than 4% (often times considerably less - as in 1.xx% on personal residences) and retain the cash out until needed makes sense to me. Rates have to go back up ... whether next year or five years. When rates are say 6% or 7% again and you've borrowed and have the funds available to repay at your much lower rate will give you an edge.

Yes, you can buy a property with your ready cash and then save up another 5-8 years to buy another but that's not something I've ever found to make any sense.

Assumption:

-fed policy is keep rate near zero for a long time

-Covid issues are for a while (supply chain problems, higher wages due to increase "risk" {another subject to discuss}, and higher demand to covid, etc),

-govt keeps running massive deficits.... inflation will be higher than normal.

These 5.5% Caps are going to get killed!! The inflation will literally eat it all up. To hedge against the inflation, your NNN contracts need to be shorter terms so you can adjust rates or better.... have built in rate changes based on CPI or just a flat 2% increase every two years. I have noticed more and more of this type of NNN lease type properties for sale.

If stag-flation becomes the norm, the money stream becomes the financing.