This is a guest post by Sachin
This article explains you five essential tips to recognizing and avoiding investment property scamsWhile there are plenty of legitimate property investment agencies and investment property seminars out there, many investors are still falling victim to property scams and the number of cases across Australia is rising!
Property scams usually involve prospective investors going to an investment seminar and meeting with an agent or a property “specialist”. These unsuspecting investors are then spun a golden tale about how they are going to make millions by following the agent’s particular investment strategy. In reality, however, what these investors are buying into is an overpriced and potentially bad investment property. Furthermore, when they try to contact the agent they bought the property through, to ask why the investment property is under-performing, their agent has miraculously vanished.
Here are 5 tips to help you recognize and avoid falling victim to these investment property scams.
Tip 1: Don’t Fall For Unrealistic Promises These property scam seminars often offer unrealistic promises, like “risk-free” investments, rent guarantees and becoming a multimillionaire in no time at all. Firstly, no investment is ever risk free and with worldwide unpredictable rental markets you can never guarantee rental returns. Also, when investing in property, you’re investing in the long term. It’s unlikely that you are going to be living as a multimillionaire right away. When going to an investment property seminar use your common sense! A wise investment is never based on a get-rich-quick ideology. And, if what they are promising sounds too good to be true — it definitely is!
Tip 2: Never Be Pressured Into Investing
Many investment property scams typically try to pressure you into investing large sums of money into an investment property or into their grossly over-priced investment strategy books. If you’re attending a property investment seminar, listen to the information being given, but never be pressured into committing to anything. Keep an open mind, but don’t part with any of your hard earned money, especially if something doesn’t feel right.
Tip 3: Seek Independent Investment Advice
Most property scams try to convince you against seeking independent investment advice on the strategies they are offering. This can be problematic, as how do you know the advice you are being given is good investment advice? Never commit to any investment strategy, without first seeking independent advice or a second opinion. Having another perspective can often prove if the investment advice you were initially given was good advice to begin with.
Tip 4: Check the Credentials of the Agency Group
Always research the credentials of the agency group (or the promoters of the seminar) who are trying to sell these investment property packages. Ask around the real estate industry and see what the group’s reputation and history within the industry is like. Are they reputable? Are they experienced enough to be providing you with property investment advice? How long have they been working in the industry? It’s important that you find the answers to these questions. If you can find nothing pertaining to their credentials, this will give you some indication of how much their advice is worth.
Tip 5: Make Sure You Have Their Contact Details
When looking into the people running these investment seminars, make sure they have a working office address and phone number. To ensure that the contact details they provide are legitimate, ring their office number and even make a spot visit to their office. It’s important that you make sure their contact details are factual, because if things go wrong, you at least have a way of getting in contact with them and tracking them down.
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