Beware Of So-Called Property Experts
Whenever property markets are performing well and the nation as a whole takes more interest in how much their own home may be worth, or whether they should think about investing, the ‘property experts’ start to emerge to take advantage.
And the good news for them is that the property markets are performing so well across the nation right now that anyone can look like an expert; or at least like they know what they are talking about.
What’s not good for the rest of us is that they often charge money for their advice and some of their suggestions can get unsuspecting folks into real money trouble. Or worse yet, you could fall victim to an out and out illegal scammer.
This is nothing new, but it’s also not going to go away any time soon. Australians love property. We are obsessed with it and that’s what makes it fertile ground for charlatans to ply their trade.
So before you fall base over apex for the sweet nothings of a charming ‘property expert’, remember that investing in property is subject to a number of fundamentals, as are the value movements of assets, so consider the following three points.
1. What proof do they have to back up their claims?
Someone might tell you property prices in one particular area are going to rise by double digits, while 30% of value will fall out of the property market somewhere else. But why are they saying this? What economic information can they show you to substantiate their claim?
They might be offering you double digit rental yields on a ‘special deal’ that no one else knows about. Unless they can stump up cold, hard evidence of what they’re talking about, steer clear. Property is not a get rich quick scheme, and if someone’s promise sounds too good to be true, it probably is.
2. Do they have experience in the real estate industry?
You don’t have to be a real estate agent or a buyer’s agent in order to have a valid opinion about property markets. But how often do we hear people coming in and offering their two cents worth without any background knowledge or context?
Good examples are the US economists who weigh in occasionally to talk about Australia’s ‘property bubble’, using the American market as a reference point. They either ignore or don’t realise the fundamental differences between there and here.
Meanwhile, someone who specialises in managed funds, or shares, or even family members who want to give you property advice based on their own experiences (which may have been few and far between), are to be taken with a grain of salt compared to someone who makes a living from being in and around the property market all day, every day.
3. Do they invest in properties themselves? If so, how many do they have?
Ever heard someone tell you to buy in a mining town, or build a granny flat to add value? Do you then wonder if they’ve done the same? And to what extent? If someone is trying to sell you the secret to great wealth and an early retirement, you’ve got to wonder why they are still working. Surely, if they know the secret, they should be living it up themselves on a private island somewhere.
Often though, they are selling you something that will give them the best commission; their best outcome, not yours.
4. Reach out to get started
b Invested founder Nathan Birch has more than 230 properties. He is open and transparent about how he got there. There’s no special secret, it takes hard work, dedication and due diligence.
If you need help finding assets below market value, or just want to get your hands on some information before beginning your property investment journey, reach out on 1300 367 925 or at firstname.lastname@example.org.