A quick search in Google showed me 5 property investment seminars coming up, in the space of a single week in Adelaide alone.
There’s no denying it, the record low interest rates and glowing media coverage of the positive swing in the property market has certainly spurred on a lot of activity in this space.
But a word of warning from the wise… tread very carefully with property investing seminars.
Stock to sell
Often these seminars or information evenings are run by property developers or groups who have stock (or properties) to sell. How can they move a lot of stock fast? Sell to a group of people in one go, and rely on the ‘pack mentality’. By this I mean it is often human nature that if you see lots of people around you doing something (like signing up for an investment property!), you won’t want to be left behind.
Remember also that just because there is a lot of shiny new stock to sell, doesn’t mean it’s necessarily in a good area for investing. These information sessions will present data, but that data may only be painting a part of the picture.
High pressure tactics
Following on from the above video on ‘conformity’ (which is a personal favourite of mine), often in these seminars the people sharing the information apply high pressure sales tactics.
“Get in on the ground level”
“Limited stock available”
“Great off-market opportunity”
All of these words are subjective – they are not objective words relating to hard data.
A friend’s parents attended a seminar just like this some years ago and were nearly convinced to buy not one, but TWO properties in the same development in an area that has extremely high rental vacancy rates!! These salespeople and their pitches can be very convincing.
I’m certainly not saying NOT to attend a property investment seminar. Information collection from multiple sources is always going to be a healthy part of an investment journey. But here are my 4 checks to keep in mind:
1. Check the Relationships
Always confirm the relationship between the investment advising firm holding the seminar, and the building company of the properties that are on offer – you are looking for independence so that the focus is on the best investment option for you, as opposed to being just a sales vehicle to move their own stock.
2. Check the Agents
With any rental appraisals for investment properties presented, check the independence of the appraising rental company, ensuring they’re not the same company (or linked to!) as the ones presenting you the property. Local agents are best as they know the local markets.
3. Check the Data
Double check the sources of research presented. Is the data correct? Is it independent of the presenting company? Can you verify it elsewhere?
4. Check Yourself
Do. Not. Be. Pushed!!! Take your time in making any purchasing decisions. If you can’t explain to a colleague or friend the “why” behind your property investment decision, you are not educated enough to make the purchase yet.
If you’d like any help verifying property data you may have come across – this is one of my favourite things to do. Feel free to reach out for coffee and a chat: Michael@equidel.com.au