Advice needed after meeting with investment property advisor from Patrick Leo.

First question: How does Patrick Leo get paid? If they get a sales commission from the developer/builder of new stock BE VERY CAREFUL. This means you are not the client, you are the stock on the shelf being sold to the real client who is the one paying the bills.

Learning the jargon and the who’s who in the industry is vital if you want to avoid sharks and rip offs. These guys may be good at what they do or may not, but my problem with buying brand new properties for investment (for most people) is that there is no opportunity for value add or negotiating discounts to market, so it is the slow boat to china in terms of capital gains usually. There are times where new makes sense but this is primarily for very high income, very busy execs who want to soak up tax and have zero effort/time/input in the journey. Average punters usually do better with 2nd hand property bought at fair or slight discount to market, plus some basic cosmetic value add strategies like minor renovations. It all depends how fast you want to grow your equity.

Secondly, if you are considering locations and markets generally, there are loads of things to consider, but it would seem you need to actually go back a few steps. What are you trying to achieve with this property? In what timeframe? Start with your big picture goals, then you look for markets that have the right metrics to fit that. There is no one perfect property or market for everyone. It all depends. In general hunt for proximity to infrastructure, jobs, major projects, lifestyle destinations, areas with limited land supply, close to water etc etc. Low vacancy rates are essential but there are heaps of other metrics to consider too. Just my 2c – All the best!

Hi FTI

Whereabouts did he suggest you purchase and what sort of property.

I have a couple of properties on the SC and be interested to see where an organisation like that is recommending.

Cheers

Yours in Finance

Wow, I thought the industry got cleaned up from these kind of spruikers. Can’t believe people can be sooooooo gullible to believe this stuff.

“He was recommended to us via our superannuation guy, (who has looked after us for years), who is affiliated with the same larger company”

This is the red light Scott —- run, run!

Hi Scott, did you end up going with them?
I am now in the same situation and they are still promoting QLD properties…

Hi Traca,
If they are still receiving commissions from builder/developer they are still NOT acting in your interest. All of the original advice provided by myself and the other posters in 2016 should still apply. Commissions are higher than ever which can result in nasty high pressure tactics. See recent articles about some commissions on units. https://www.afr.com/companies/financial-services/developers-offer-advisers-90-000-to-flog-high-rise-apartments-20190813-p52gk1

The take home message is still the same as Benny says, do your research, ask good questions and either be prepared to do things yourself or else build a team of actual professionals who will do quality work for the fees they charge you. If using a Buyer’s Agent they really should be REBAA accredited for example this will ensure they are not selling property as it is part of the code of conduct.