If you are looking for a smarter way to invest in real estate, a Direct Title Security, or DTS, might be the right choice for you. Forrest James from Emerson Equity breaks it down in simple terms. A DTS gives you control, predictable income, and long-term stability, which investors often do not get with a traditional DST, or Delaware Statutory Trust.
What Is a Direct Title Security
Forrest explains it clearly. A Direct Title Security, or DTS, is a portfolio of homes that you can buy outright, fee simple. It is ownership you actually control. Unlike a DST, where a sponsor makes the decisions, a DTS puts you in charge of your property.
Each home also comes with a credit tenant lease, usually for ten years. Forrest describes the structure as taking a proven commercial real estate system, the triple net lease, and pairing it with direct ownership of residential homes. The result is the stability of commercial income combined with the comfort and familiarity of residential assets.
Lease Terms That Work for You
DTSs come leased when you buy them, usually with a ten-year standard lease. However, investors can also choose a fifteen, twenty, or even thirty year lease option. This flexibility makes it easier for investors to plan for long-term income or structure a 1031 Exchange that fits their timeline.
Why a DTS Matters for 1031 Exchange Investors
DSTs are useful, but they limit control. They are often used for a passive 1031 Exchange, where the sponsor controls management decisions and the eventual sale. A DTS changes that dynamic. You still receive predictable income, but you also retain ownership and flexibility.
Forrest highlights this point by saying that a DTS gives control and liquidity back to investors that they do not have inside a DST. Investors keep the income features they want, without giving up authority over their property.
Triple Net Leases in Residential Real Estate
A major advantage of a DTS is the triple net lease structure. In commercial real estate, this type of lease requires the tenant to handle taxes, insurance, and maintenance. Forrest notes that a DTS brings the same predictable cash flow found in commercial buildings into residential real estate. This reduces day to day involvement for investors and gives them clearer income expectations.
Control and Flexibility Investors Appreciate
Tom Moore points out that DTS lets investors actually participate in decisions. They can influence outcomes, customize leases, choose their timeline, and plan for future Exchanges. This level of involvement is very different from a DST, where an investor is a passive participant.
What This Means for Your 1031 Strategy
Direct Title Securities are creating a new path for 1031 Exchange investors. They combine fee simple ownership, predictable long-term leases, and the simplicity of a triple net structure, all inside residential real estate. Forrest James and Tom Moore show how a DTS gives investors control, flexibility, income stability, and the ability to shape their long-term plan.
For anyone preparing for a 1031 Exchange, DTS offers a modern alternative that provides ownership benefits and a clear, stable investment experience that traditional DSTs often cannot match.
If you think that a DTS could be the right move for your own 1031 Exchange, or you would like more information, reach out to the team at Equity Advantage today.
The Guys With All The Answers…
David and Thomas Moore, the co-founders of Equity Advantage & IRA Advantage
Whether working through a 1031 Exchange with Equity Advantage, acquiring real estate with an IRA through IRA Advantage or listing investment property through our Post 1031 property listing site, we are here to help Investors get where they want to be. Call them today! 503-635-1031.
