We’ve all heard that property is best treated as a long term investment, so if a get-rich-quick deal sounds too good to be true, it probably is.
The risk occurs when investors – trying to get ahead in a hurry – find themselves wanting to believe in the glossy brochure marketing hype of a shiny new development. But if the promised growth never eventuates, they end up in financial dire straits.
So how do you avoid being taken for a ride?
Your Investment Property magazine offered these six tips to avoid being taken for a sucker.
- Avoid a developer’s one-stop shop service and seek independent advice from your own solicitor, valuer and mortgage broker.
- Do not believe claims of guaranteed incomes or risk-free investing. Every investment involves risk and it’s your job to understand those risks before you sign on the dotted line.
- Don’t get suckered into seminars that sell properties. More than likely you’ll be bombarded with psychological tactics designed to help developers offload stock to investors.
- Be wary of inducements – like free stamp duty and rental guarantees – for off-the-plan stock.
- Avoid house and land packages in new estates with high supply and low rental demand.
- Do not venture into overseas markets. You are essentially buying blind and without a safety net.