Australian Investment Institute

[boomtown]

Nice detective work!

I reckon anything with the word "international" in the title is as dodgy as the word "institute".

Colliers International?

Lol probably - last time I spoke with them they tried to sell me an OTP ski chalet in Nagano Japan as an investment. Its hard to take them seriously when they dole out such tripe.

*Edit* sorry that was Coldwell Banker not Colliers International.

 

[toony]

I got a call from them a few weeks ago. I wasted 20 mins of their time asking if they were a public company, if they were registered to give Financial advice etc while sounding excited about getting advise on reducing my tax. I Asked who the directors were? The 15 yr old on the other end had to keep getting her supervisor. Eventually i only spoke to the supervisor. I then told them i would look at their web site as i did not know them from a bar of soap and I dont accept cold calls. Hopefully they will never call me again.

 

[Rob Williams]

I reckon anything with the word "international" in the title is as dodgy as the word "institute".

I'm not a big fan of the word "Academy" either.

Does anyone remember the adverts showing the Pond's Institute? A bunch of guys in pristine white lab coats making womens facial creams in a shiny glass lab? I'd be shattered if I found out that they were dodgy. Worse .. that they didn't even really exist.

 

[The Y-man]

Hmmm.... so starting a company called "The International Institute of Investment Academies" may not be a good idea.....

Cheers,

The Y-man

 

[Bill.L]

Hi,

The 'International Academy of Institutional Investment' ??

bye

 

[Xenia]

Here is a big hint: anything with the word "institute" in the name is BS.

That rules out at least half of existing organisations!
I used to work for a place called the Vaccine and Infectious Disease Institute! I guess my whole scientific career was BS!

 

[dmac_25]

Thanks guys,

thankfully i didnt have to pay for there consultation they were asking like $930 for the first meeting to set it up and chat. I got some good info from them but thats all i went for was the info.

 

[dmac_25]

Now guys,

I had another meeting with these guys last night, at this stage i havent put my name to anything or handed over any cash.
What i want to know is why you think they are not a good company to use??
I have the break down of the fee etc and they make there money on the property management and i assume from the sale of the property.

any help would be great.

 

[WillG]

Now guys,

I had another meeting with these guys last night, at this stage i havent put my name to anything or handed over any cash.
What i want to know is why you think they are not a good company to use??
I have the break down of the fee etc and they make there money on the property management and i assume from the sale of the property.

any help would be great.

Mate, post the details of the deal including 'prop management' fees, asking price and expected rental. You will get some constructive objective analysis.

Hope this helps

 

[Aimjoy]

Now guys, I had another meeting with these guys last night,
any help would be great.

dmac_25, you are starting to get beyond help.....maybe I can offer you a slap over the back of the head?.....are you not listening?

Do you own DD by all means.
BUT beware that you ensure they are offering INDEPENDENT advice.
i.e. They make money out of the sale - sure BUT are they inflating the price? getting a kick-back from the vendor (developer), giving you rental guarantees from a $2 shelf company that you can't collect from in the event you need to make a claim.....................etc etc.

Oh just hang a round here and read some more - you'll get the gist of it soon.

Sorry if I cam across a bit harsh but really..............

Aimjoy

 

[Bill.L]

Hi dmac 25,

Simply put, you can do better and cheaper for any and every deal that this type of company could come up with.

By doing your own research on an area, your own negotiating on price, (it is a buyers market), and searching for your own finance, by using mortgage brokers etc, the return on your dollars spent will be superior.

You will be cutting out the middleman, plus gaining in your own education about how to invest by doing.

As an off the cuff example, assume that your own work will allow a 20% compounded return for a $50k investment (using leverage, eg a loan) over 20 years. Then think of the same investment but paying a tiny 3% fee, therefore 17% compounded return.
$50k x 20 years at 20% = $1,916,879
$50k x 20 years at 17% = $1,155,279

Plus you learn when you do it yourself, perhaps the best investment outcome over the long term.

bye

 

[Twitch]

I think it's a bit worse than has been suggested so far. From their site there's this

Simple Rules of Property Investment:
1. Buy brand new to maximise tax benefit
2. Buy in a recognised developing area to maximise capital growth

IMHO this is code for selling overpriced properties in poorly serviced outer suburbs which have little to no supply constraints. The "independant" advisor will then get a commission from the developer (this is your money by the way).

I wouldn't walk away, I'd run.

 

[Bill.L]

Hi Twitch,

Earlier in the thread, I used the 'run' word....

after a bit of research, I changed it to.....

SPRINT

But some just don't want to learn. I mean that nice knowledgeable expert/salesman in the modern expensive looking office, who is so friendly and sophisticated, would look after my interests above all else...

yeah right.

bye

 

[dmac_25]

dmac_25, you are starting to get beyond help.....maybe I can offer you a slap over the back of the head?.....are you not listening?

Do you own DD by all means.
BUT beware that you ensure they are offering INDEPENDENT advice.
i.e. They make money out of the sale - sure BUT are they inflating the price? getting a kick-back from the vendor (developer), giving you rental guarantees from a $2 shelf company that you can't collect from in the event you need to make a claim.....................etc etc.

Oh just hang a round here and read some more - you'll get the gist of it soon.

Sorry if I cam across a bit harsh but really..............

Aimjoy

Nar no need for a slap,

As i have got no attachment to them i can walk away at any time that how i wanted it.

I went to get some info off them and to see how they structure things.

Im not to keen on having som many peoples hands in the pot.

 

[dmac_25]

Hi dmac 25,

Simply put, you can do better and cheaper for any and every deal that this type of company could come up with.

By doing your own research on an area, your own negotiating on price, (it is a buyers market), and searching for your own finance, by using mortgage brokers etc, the return on your dollars spent will be superior.

You will be cutting out the middleman, plus gaining in your own education about how to invest by doing.

As an off the cuff example, assume that your own work will allow a 20% compounded return for a $50k investment (using leverage, eg a loan) over 20 years. Then think of the same investment but paying a tiny 3% fee, therefore 17% compounded return.
$50k x 20 years at 20% = $1,916,879
$50k x 20 years at 17% = $1,155,279

Plus you learn when you do it yourself, perhaps the best investment outcome over the long term.

bye

Thanks Bill as i said i wassnt to keen on it from the start just wanted some info and the meeting last night was setup a few weeks ago so just wanted to sit and listen to what he had to say and gets some info for free.

I think it's a bit worse than has been suggested so far. From their site there's this



IMHO this is code for selling overpriced properties in poorly serviced outer suburbs which have little to no supply constraints. The "independant" advisor will then get a commission from the developer (this is your money by the way).

I wouldn't walk away, I'd run.

I understand that everyone gets there cut. Cheers

Hi Twitch,

Earlier in the thread, I used the 'run' word....

after a bit of research, I changed it to.....

SPRINT

But some just don't want to learn. I mean that nice knowledgeable expert/salesman in the modern expensive looking office, who is so friendly and sophisticated, would look after my interests above all else...

yeah right.

bye

Cheers

 

[The Y-man]

any help would be great.

D Mac,

I guess for starters, are you aware of the markup involved on property sales? It could easily be +30%

So for what you could buy "off the rack" for $400k, you may be likely to pay $120,000 more for it.....

A few other things (some already noted above):
1. very very new ACN - that in itself is not a problem, but it brings to question their track record.
2. No AFSL - probably not a huge issue, but sounds like some of their offerings come perilously close to "financial advice"
3. Now here's one from personal experience of using a company like this before: Are they licensed to sell the realestate? The company we were dealing with was not. Not only that, it took the deposit money, and then disappeared.........

I am not saying that AII is a bad company - and as long as you are prepared to go in understanding the following risks, then do go ahead:

1. You may lose your deposit. (happened to us)
2. You may be locked into a contract which will need to be settled, even in the event of deposit and company disappearing (happened to us)
3. You may end up with a property that the banks will not value up to your purchase price (eg, you buy a prop for $500k, but the banks declare it is only worth $300k - you need to come up with $200k to settle, or they will come after your other assets through debt recovery - quite common)
4. You may find the property you purchase is extremely expensive to run - it may have BC fees of $5,000 and it may be unrentable!

Cheers,

The Y-man

 

[Peter Parker]

What i want to know is why you think they are not a good company to use??

They may be the most ethical company in the world.

Or they may be shysters.

I don't know.

But what you must focus on is that you're handing over several hundred thousand dollars for an ASSET whose purpose is to MAKE MONEY for you.

You must understand that even if the marketing company is an honest outfit there is no link between that and the performance of your investment.

Not all off-the-plan purchases are necessarily bad, but on average they appreciate slower than established houses and may be much dearer than comparable units a year or two older.

To put it another way, if you were to walk into a suburban real estate agency blindfolded and pay full asking price for a randomly picked house then that has a better chance of success than buying new from a promoter who calls himself an adviser.

Peter

 

[murtagh]

What i want to know is why you think they are not a good company to use??

I think the short existence of the company is a bad sign - I would let other people be their test cases.

But the other more important thing is that how do you know they ARE worth dealing with?

Investing is like most things which require specialist knowledge - when you start out, you don't have the ability in the area to judge your ability in the area.

For example, when you start driving .. you're rubbish. And you don't ever know it! That's because you lack even the ability to tell a "good" driver from a "bad" driver. Over time, as you pick up skills you begin to be able to tell the difference between a smooth gear change and a terrible jerking mess.

Once you can recognise the details of what you are doing and what other more experienced players are doing, you begin to see how truly terrible you were in the first place!

If you don't develop the skills to find and make deals, you can't really judge if you've made a good deal. And if you can't even tell if you're making good deals, what hope do you have of judging someone else's deals?

In cases where you put trust in someone's ability to do the work for you, you need to have enough knowledge in that area to judge their performance. Otherwise you're just waiting for someone to take you for a ride.

So for newer players, like myself, I think placing small bets at the table and learning your lessons is important.

 

[JOJO]

So - we paid the $500 to go along and listen for a couple of hours - equivalent of a seminar I suppose.

Then this guy came to the house (anyone wants his name email me) with two "perfect properties". He was good though and we were hooked in - handed over a deposit to reserve the property. This happens to be in Derrimut - know a bit about the area so wasn't unduly concerned about this. I also checked out the other one in Mornington - they do exist and are up for lease with the agent recommended Planinsek.

However then read all these posts on the forum and thought "yikes" what if these people run off with all my cash! so into the bank and they were great (CBA). They did a bit of investigation on the AII - legitimate with an ABN etc, and Odyssey - less to find on those. They advised if we were that concerned to cancel our credit card - done that.

They did reassure us by saying that if these were fraudsters then our account would have been wiped out almost instantly.

So now the guy knows that we have panicked and he's coming back tomorrow with the hard sell again.

A part of me isn't worried really - I can still back out and the bank said they would get the deposit back somehow through legal....

BUT - the property of course sounds too good to be true.

AND - one of the things I love about investing is going to seek out the properties myself getting a feel for them etc. That's the fun part. Doing it through these guys removes that excitement. I have a great mortgage broker so don't even want to go down the Odyssey route unless I need a fresh look at my loan structure.

So once the guy has been back again I'll update you.

If they are legitimate then he can give the money back - if not we have a fight on our hands but better to learn the lesson by losing $2000, rather than $350,000.

Jo

 

[Peter Parker]

Then this guy came to the house (anyone wants his name email me) with two "perfect properties". He was good though and we were hooked in - handed over a deposit to reserve the property. This happens to be in Derrimut - know a bit about the area so wasn't unduly concerned about this.

If they are legitimate then he can give the money back - if not we have a fight on our hands but better to learn the lesson by losing $2000, rather than $350,000.

Although I think it's worth thinking about opportunity cost.

The biggest opportunity cost is 'doing nothing'. It looks like you're going to avoid incurring that so you're ahead the the pack here

The second biggest opportunity cost is buying a property that does not perform very well. That means it must produce healthy capital gains or healthy rental income (and preferably both).

In this vein one needs to conclude that one $350k property in Derrimut (which has almost no services) will appreciate better than two $175k properties in (say) Melton (even though the latter has possibly 3 times the land area) or a single older house (in say Chelsea or Ringwood) for the Derrimut purchase to make sense.

It's a tough question and can't be answered with precision, although there are some probabilities. But assuming the Derrimut place doesn't wreck your serviceability then the purchase of a second place soon will help greatly in getting some answers