Beware property investment seminars

The housing boom brought an array of spruikers to property investment pushing dubious "wealth creation" seminars. Promoting their service under an "educational" guise, they often advertise free seminars but then demand high fees for further instruction. They also earn lucrative commissions as agents for property developers whose projects they ultimately recommend, and collect again from a stake in the loans offered to investors to finance their purchases. Queensland property, mainly the Gold Coast, has long been the focus of these marketing schemes but Sydney, Melbourne and now Auckland in New Zealand have also been aggressively marketed. The Australian Securities & Investments Securities warns anyone going along to a seminar believing they are getting advice that it is often a "product push" they receive. The investment "secrets" offered can involve buying multiple properties at once, often apartments off the plan. This often requires a heavy borrowing commitment and inflated prices. There is also an emphasis on deposit bonds which remove the need to stump up a full deposit until settlement. Sharper operators advise selling one or all of the property assets before settlement for a quick profit or to fund further investment. Macquarie Bank has published a guide on how to avoid risking money in fraudulent property schemes - "Plain English Dos and Don'ts for Property Investment". A spokeswoman for Macquarie said that people often buy Gold Coast properties off the plan and the developments sometimes don't exist - and the scam is continuing. We can't repeat the message often enough, she said.