The problem as I see it, Freckle, is the difficulty in compiling figures (which by default will be history) with a market that is so vast and so local.

A lot of the cities in the figures you quote are bigger than Australia in population. Yet individual streets have their own characteristics. You can walk 200m and go from ‘nice’ to ‘nasty’ on some streets – these micro communities on a massive scale will distort figures dramatically and the ‘smart’ guys on the ground like Kyler, Alex, Emma etc can arbitrage this with great success. Jay deals on a level above these guys (he uses these guys to help him pick the eyes out) so he gets a ‘national’ picture and they are all saying the same thing – the bottom has past.

From my own experience, my rentals in a mid scale beachside area of LA are getting busier, but to counter that I would also point out that peak subprime also was very busy – people renting because they were out of their houses elsewhere. My little area was not sub prime affected to any real degree, so I immediately see these ‘US figures’ as a nonsense – like many in the US, it didn’t affect me really, so not my problem:)

Maybe you get a return selling your foreclosure to these guys:

http://redgreenandblue.org/2009/03/30/greening-foreclosures-buy-a-home-in-detroit-for-40-and-turn-it-into-a-green-urban-space/

One day it may be a nice place to live again – although I shouldn’t really comment as I haven’t been there*, however I saw a couple of fascinating docco’s on the re-greening of Detroit by bulldozing vast tracts of industrial and residential land and turning it into green space, mini farm plots community gardens and parkland.

I like to buy Australian bushland to ensure its protection from idiot supposed greenies and the complete morons at RFS, but helping create inner city parklands with unsaleable or unrentable property is a noble cause.

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*I have been a witness to Gavin (ABC 730) trying to repair his ‘ready for tenant’ property in Detroit. Aside from the difficulty of finding tradesmen to renovate (it was deemed a waste of time) the investment he was sold by Andrew Allan as being personally chosen for its high rental demand is now boarded up to hopefully reduce its kerbside appeal to squatters.

I have made some big-gamble plays in RE, but I have learnt that whilst the ‘hope and pray’ strategy may pay off in time, it is not something I need to present and explain to my accountant or the ATO at the end of the year…

The Auto industry is doing better, but why would anyone want to take such crazy risks when it is totally unnecessary. 6% in a bank in Oz is an unheard of number for Gavins $65,000, that is STILL costing him a fortune without a single rent cheque.

Except this guy buys from wholesalers – and doesnt care what he gets.

No need to rush Gavin, all in your good time. I was just trying to get the investment picture that you were 'sold' in a nuts and bolts form. On paper, your Andrew Allan deal looks good so far and you also had a great personal recommendation from someone you respected – just like 99.99% of Bernie Madoff's clients.

I think it is important people see exactly where it started to fall apart, the bad stuff hasn't happend in your detailed time line – yet!

Sorry to nit-pick Gavin, but:
Youngstown $12,000 with $6500 to renovate = $18,500
Detroit $27,000 with $8000 to renovate = $35,000

$39,000 worth of property and $14,500 worth of repairs.

What rental were you led to believe you would get once reno's completed? I believe Youngstown was a 4u? and Detroit was SFR?
How long were the reno's going to take?
Was the rental guarantee to rent 'inside' 3 months, or 'for' 3 months?
Did you see photo's of the properties inside and out that you were going to buy?
Finally – it seems from what you said above that the $13,000 was nothing to do with renovating, project managing or anything like that, but merely a 'fee' for looking on the net – am I correct?

Deano, without wishing to distract from either Richard's thread or  what you say (and it isn't really wrong, though I am with Ziv and Emma 100%) we could have ALL been caught in the beginning. Richard is very brave, he must have been one of the first few to be caught and went out and found good people to help him solve a major problem – yes he was naive, but fixing it and admitting it takes guts, he has also learnt very fast and is doing a great service to everyone with this post. Imagine how hard it is to accept you have probably lost your entire savings, then to have to relive it first by spending 2 years fighting with the guy who accepted your money, then proving it to investigative journalists and finally rubbing salt in the deep wounds by putting it up for public consumption?

As Emma said above, these guys portray themselves as experts. They are not. They are expert at getting your money in their hands and little else.

The worst rip off Richard experienced through Andrew Allan was discovered very recently by a chance 'did anyone check this?' moment from Emma above. And it was something so basic it would have caught me, not 'could' but 'would' – and I kid myself I sort of know what I am doing in the US. 

There but for the grace of god go us all. As I have said many times, what annoys me most is it gives a good industry a very bad name.

Digression: You also have to remember the US is harder edged than Australia. In Ziv's world (I don't know for sure, but I could put money on it) this type of thing would be completely unheard of. COMPLETELY. I signed a customs form this morning in Tokyo with an expensive sterling silver mont blanc pen. I have carried this pen with me for nearly 15 years so it has sentimental value as well. I got to the bus outside the terminal and realised I lost it. I talked my way BACK through customs and when I got to the baggage area a girl came rushing up with a gift wrapped package containing my pen. Try explaining to those people (the people of Ziv's world) how they could be ripped off tens of thousands buying real estate…

So why in gods name are you attempting to flog your lack of experience to others? This is exactly the type of operation that makes me very nervous. I used to be open minded until I saw first hand exactly how this can end in tears.

Steve (above) went and spent time with someone who clearly knew what they were doing and had basically spent their entire lives in the same area. I've done OK in RE in the US but the only reason I have done that is because (like Steve) I went out and found an expert I felt (for whatever reason) comfortable with. Pre internet that was very difficult and time consuming to do, but the work I put in was worth it.

I have no issue with you (or anyone else) going to the US armed with a US Property Power Pack written by an Australian with only a smattering of understanding of the US market and having a go yourself, but to foist that inexperience on others and use that inexperience to sell a product I do have issues with. The only thing that makes me at all comfortable with what your website says is that you (unlike a LOT of others) do make it clear you have no experience to speak of at all.

I am sure you are nice people, but I only looked at your website because your posts conveyed a total lack of experience and understanding. Unfortunately your website merely confirmed this. You can make good money investing for yourself, but please avoid involving your advice/inexperience and other people's money – I can all but guarantee tears and suffering….

This information is gold for people. Obviously I have some knowledge (though far from detailed) of what is going to be explained to people now and I think many will be shocked. I couldn’t believe some of the things that were done to Gavin – I’m sure you won’t either.

Gavin deserves a lot of support from everyone for attempting to help other people by explaining how he was trapped.

Thanks from everyone in advance Gavin – this will be a riveting read.

No – it actually increased in value. More tenants = increased rents = higher valuation = happy days… I sold my worst building for a profit (small) at the absolute bottom of the market.

It doesn’t take much to build up a portfolio once you start. It probably sounds a lot to begin with, but would be nothing compared to Jay, Alex etc… Just build up one at time.

Nothing against LLC’s – as you said put your property IN LLC’s. Don’t buy someone else’s LLC that may (or may not – particularly if you deal with Andrew Allan) have a property in it. Big difference!

These guys are not Real Estate agents, they are not allowed to legally sell real property (probably not allowed to even work in the US) so they get around that by buying and selling LLC’s.

They are buying something they know nothing about and selling to someone after adding a bewilering range of fees and charges onto the purchase price.

I hope everyone understands.