ERICOPOLY

I have always been bidding on homes against the market. In my experience it has always been tied to income, not inflation.

But I do like the preferred structure of APTS for the purpose of holding in a taxable account. It effectively pays out the taxable income to the preferred holders and leaves the common stock with additional capital gains.

I switched most of mine out for BABA options on October 6th. Not regretting it.

Anyways... it's clear that leveraging 4% cap rate assets with 6% coupon preferred is not lifting the market's skirt. Nobdy's going to pay the liquidation value unless a liquidation is on the table.

Investors in other REITS: what if rates are 6% when we refi 9 years from now? Investors in APTS: almost half of it already is.. the name is 'preferred'.

That was more true 2 years ago than it is today. And rents are 20% higher when they roll over.

I mean, in 12-18 months time if these 20% higher rates flow through the APTS multifamily portfolio they'll be able to stop the issuances and pay a sizable real dividend. However, this is worth nothing to Mr. Market because cash flow doesn't matter? WTF.

I'd rather have the newbuild apartment complex with today's financing lows rather than the REIT stuffed with old mortgages carrying higher rates. So there's that. How much of a discount that should bring depends on when those old mortgages come due and who can say where rates are in 7 years for example. So the REIT isn't apples to apples with the market prices of multifamily for that reason if no other. However, but that was all true two years ago and rents are 20% higher now. I can't explain the total apathy.

The strange thing about the apartment REIT market and the well publicized jump in rents is that the REIT stocks discussed on this board have not responded. They have snapped back from their covid lows but look at their stock prices 24 months ago vs today.

He already told us why he mentioned 31 days. He says so right on page 29. quoting from page 29: "Of course, the loss would not be deductible if expiration of the option was itself a wash sale."

Are there any divorce statistics available? Any links? Anecdotally my wife and I know of a few couples who seemed to get along alright until they started working from home in 2020 due to covid-19. Now they are separated or divorced. Now each prior couple requires an additional housing units and it is typically a rented unit. That kind of event can spur new household formation and I think it is reasonable to call it a one-off. Later, these free floating singles will eventually pair up again.

Well it actually did sound impressive to me when I first read it.

714k. Impressive sounding. How many are needed? https://www.marketplace.org/2021/07/02/how-many-more-housing-units-do-we-really-need-to-build/

In other words, on pages "27-29" he provides an example of how 'should' isn't happening out in the real world (they hold the expiring call beyond the wash sale period). That is not contradicted by what is written on page 4.

No, he is saying 'should', he is not saying that it 'is' that way. Remember that he is writing the paper as an academic: "Rather, the “call spread” approach is offered as a theory for policymakers to determine the “right” answer as a matter of policy." He writes: For instance, a wash sale should be triggered when stock replaces a call option It 'should' work that way (he writes). 'Should' is not to be confused with 'is'. He literally means 'should' and the word choice is very cautious. Later, on pages 47-49 he shows how 'should' and 'is' are different and he mentions "of course" the 30 day rule.

You are saying the rest of the paper contradicts this statement from the attorney on page 29? "Happily for the taxpayer, though"... "the purchase of stock on November 2 is more than thirty-one days before the option expires" Can you cite the spot?

Oh, if the gains could be washed it would de facto eliminate capital gains tax.

If there were such a spirit I would not be taxed when I sell for a gain and repurchase a substantially identical security within 30 days. Alas...

I do think otherwise when the following condition (from the attorney) is not met: "Happily for the taxpayer, though"... "the purchase of stock on November 2 is more than thirty-one days before the option expires"

I'll point you directly to it: "Happily for the taxpayer, though"... "the purchase of stock on November 2 is more than thirty-one days before the option expires" page 29: https://scholarship.law.columbia.edu/cgi/viewcontent.cgi?article=3484&context=faculty_scholarship

No, I'm saying the authors seem to contradict themselves. When they introduce the out-of-the-money strategy on page 27 they claim a wash sale occurs because a loss is taken on the shares and out-of-the-money options have been purchased. But then on page 29 they argue against themselves, saying that out-of-the-money options are not "substantially identical" and don't trigger wash sales.

And prefaced with "Of course"

They mention 31 days for what reason then?

+1

These guys are picking and choosing here: "Second, the stock in the new lot is not substantially identical to the option (i.e., since the option is out-of-the-money)." cited from page 29: https://scholarship.law.columbia.edu/cgi/viewcontent.cgi?article=3484&context=faculty_scholarship I'm not sure how they're going to be convincing in an audit with that remark when it undermines their claim that the loss was transferred to the calls upon purchase of said calls which they later argue is not substantially identical because they are out-of-the-money. They cannot have it both ways.