Expert Advice with Ahmad Imam 22/08/2018
Scams, get rich quick schemes and self-styled gurus abound in the property industry, and many a hopeful investor has seen their financial security go up in smoke when they’ve fallen victim to the latest real estate fad.
So how can you tell if you’ve stumbled upon a genuinely fantastic opportunity… or you’ve simply crossed paths with an unscrupulous “expert” whose only real goal is to separate you from your hard-earned cash?
Here are a few warning signs to look out for…
They claim to have a “one size fits all” secret strategy
It’s complete nonsense to suggest that any one real estate investing strategy is going to suit all investors or all markets.
Buying a three-bedroom home in country Tasmania is nothing like buying an apartment off the plan in central Sydney, and investing long-term is a totally different proposition to buying and flipping for a quick profit.
Any spruiker who tries to convince you that they’ve unlocked the secret technique to investing success that works for anyone, anywhere is pulling your leg.
They have unbridled optimism
We all know that the property market operates in peaks and troughs, with periods of stellar growth (such as the last couple of years), and flatter times, such as following the GFC.
A property guru who seems to be in a constant state of elation about the current market conditions is either delusional, of seriously sugar-coating the reality.
It’s not always a “great time to get into the market” or “the perfect time to build your portfolio” – sometimes it’s best to bide your time, and ride out an uncertain market.
They have a serious case of word vomit for bogus, meaningless buzzwords
Those in the property industry are fond of using marketing buzzwords that generally mean diddly squat in reality.
References to legitimate awards and titles are a good sign, but self-appointed credentials should be a big red flag.
The same is true for the claims they make about their program or strategy – unless it’s backed by genuine results or a real award scheme, it’s meaningless, so don’t fall for it.
They are constantly trying to sell you something
The weekly emails that keep reminding you to download their e-book, the invitations to seminars where they spruik a series of books or CDs, the constant barrage of testimonials about their exclusive coaching course – these people never let up!
It’s all a ploy to continue extracting more and more money out of you, without offering anything particularly new or valuable… but just enough to convince you that you need to sign up to the next step so you can learn more.
It’s like a never-ending ladder you must climb to reach the lofty heights they promise, but you never seem to get to the top.
A really experienced and successful coach or mentor will have so many referrals from happy clients, they won’t need to bombard you with special offers or one-time-only discounts.
Their testimonials sound like fairytales, and the “satisfied customers” are mythical creatures never seen in the wild
You can’t miss the testimonials and success stories plastered all over their website and e-books, regaling you with the amazing stories of Sharon and Ned, who went from $20,000 in debt to owing five properties in three years, or single mum Melissa, who retired at 35 thanks to their awesome guidance.
Notice how there’s scant details on exactly how these guys achieved such results?
If they seem too good to be true – like $3 million in property assets on a $60k income – it’s usually because they are too good to be true!
They’ve cunningly cherry-picked their clients and promoted a handful of mind-blowing stories, but conveniently neglected to mention the $200,000 inheritance Melissa got when her grandad passed away, or the fact that the first two properties Sharon and Ned purchased were only $120,000 each, 15 years ago – hardly applicable to you, right?
They target vulnerable beginners
Experienced, successful investors don’t fall for the above tricks, so property gurus have their sights firmly set on newbies, with their hopes high and their guard low.
They do this by promoting no or minimal deposit options, something an investor with equity in existing properties doesn’t need to consider, or offering to back your first investment as evidence of their confidence – but the chance of them actually stumping up the promised cash is zero!
If you’ve got a friend or family member who has been investing for a while, ask them to take a look.
Chances are they’ll tell you is all nonsense, and give you better advice for free.
Ahmad Imam is a Director of Metropole Properties in Sydney, is a highly skilled wealth strategist and a passionate property investor. He has a degree in Commerce, is a licensed estate agent and qualified property investment advisor and has personally coached and educated hundreds of clients to create wealth through property.
He is a regular commentator for Michael Yardney's Property Update.
Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.
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