Expert Advice with Todd Hunter. 25/12/2016
As a client who is about to allow a Buyers Agent to go and spend hundreds of thousands of your hard earned dollars, you should at the very minimum be researching who you are about to get involved with. This is that story.
I recently had the pleasure of meeting some clients that found me through blind luck. Let me explain…
David and Leanne Bowers live in a nice home in Sydney’s North West. Recently, David was given some money through an inheritance, so the first thing they did was pay off their home loan. On top of this, they had some extra cash that they wanted to use towards investing. Both working in good paying jobs, they had little time, nor knowledge, on how to create wealth. So they bought some property investing magazines and started calling a few firms.
Leanne’s marketing background means that she was quite thorough in her research of the company they would use to spend their money for them. But it didn’t start out very well. With David being the more cautious of the two, they decided they didn’t want to risk buying off the plan and wanted to spend under $500,000 on each property. And like many clients, they thought 1 property every 6 months would be manageable. And I have to say, I do agree with them.
After ringing half a dozen or so companies, they found a firm that they thought suited their investing style. So Leanne, as many clients do, wanted to see some past examples of houses that this firm had previously purchased for their clients. And that’s when things got weird. They told her that this is not the norm and that it’s a breach of their past client’s privacy. She was not after the clients names or addresses but only some photos, similar to what realestate.com.au has on the sold section of their website. Again, they didn’t want to supply these and said they would, only if David and Leanne supplied certified copies of their ID as they thought she was a competitor. I think paranoia or guilt had got to them.
After many emails, she decided to Google this firm and the Buyer’s Agent and this was when it all made sense. He had only recently left his past employer and set up in business for himself. And this was when she accidentally found us.
I suggest this is something that should be done by every investor before choosing who they want to work with. Google search the Buyers Agent’s name, their company name along with other great key words like; Scam, Complaints, Rip off, Con, and my personal favourite is adding the name Neil Jenman after their name, as Neil has exposed many of these unscrupulous firms and people.
So you could say that Google saved their lives. Investing with the wrong people, in the wrong places, at the wrong time, can ruin investors for life.
So since coming on board, David and Leanne have purchased one property in the ACT and will now relax and enjoy Christmas and the New Year before continuing to invest, in line with their investing game plan that they have in place. That plan, being to invest in 8 properties over the next few years and let them just sit there and grow in value over the next 20 years. And even possibly look at purchasing another house in their superannuation. They will put all their efforts into repaying two of those properties off in that timeframe. Then potentially, sell three of them to pay out another three loans. Leaving them with 5 unencumbered outside of super and one in super.
Plenty to retire on I reckon!
Todd Hunter is director, buyer’s agent and location researcher for Sydney-based wHeregroup. He is an active property investor himself and amassed a portfolio of 50 properties by the age of 31. For more of Todd's musings, visit the wHeregroup blog.
Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.