As I predicted in 2011, property is booming and at the high interest rates I predicted and in the cities that I predicted. Also as I predicted (disappointingly) spruikers are coming out of the woodwork, endorsing and promoting property.
Firstly, what are the dangers? Last year there were thousands of mortgagees in possession across Australia. This proves that buying property is not an automatically risk free investment. Why do people fall into these property traps? The answer is simple. SPRUIKERS!
So what is a spruiker? Someone who hypes the potential of a good/service that they are profiting from. By law I believe real estate agents have to represent the vendor not you. The law states that they have “a legal, moral and fiduciary duty to promote and protect the interests of the vendor”. In other words, not you the buyer!
See that every agent gives you their promises in writing eg. What are the comparisons that they are telling you about that make your possible purchase look good! The rent estimates that they are giving you; get these in writing from at least three professional, independent letting agents.
Pressure selling – how to protect yourself? Simply, don’t sign anything! Insist that you want your solicitor to check the contract before signing. Go home, wait for the contracts to arrive from your solicitor and make a considered decision in private and free from pressure. Note that every contract is in the vendor’s interest. However, you can alter these terms and conditions to protect yourself. At Property Club we have up to 12 different clauses that we insist go in different contracts in different states and in different situations to protect buyers.
So get in writing clearly what your income and expenditure is going to be to the best of everyone’s ability this year and the following years. People who have gone mortgagee in possession are those who are unaware of their upcoming expenses and how to maintain their investment portfolio. With Property Club’s ongoing support, we give every buyer this education. It’s up to you to take advantage of our free services.
Finally, if you are buying for investment whether it is shares, share trusts or property you need the right advice from a successful professional who has an equally successful client base over many, many years, Property Club has been going for 20 years now.