Hotspot central
- Thread starter jacko18
- Start date
You join with others in a syndicate and become the developer?
Where does hotspot central make their money?
I believe 20% is the oft talked about developers margin (or what one should aim for), maybe this is it
Yeah don't now were makes its money
I think I just see something then think that sounds good then research it then doubt if I can trust it sounds to good
Just had a quick look at their site and the option of buying new stock they are promoting/developing.
I guess they manage the development or employ a project management company and you provide a deposit which will differ depending on the size of the project. This is similar scenario to what EOS armchair investing in Perth is promoting.
These are my concerns/risk:
You have no control over the project, in other words if the budget blows out for whatever reason you will be wearing it and instead of a profit it could possibly be a loss.
What happens to your deposit? Do you actually own anything, would need to seek legal advice on the finer points
Your money/deposit is tied up and this could be in excess of $100K until the project is completed, looks like one project will take 16 months, that's a long time between drinks. I could identify a moving market during this period and make money without the risk.
How long have these guys been involved in developing? Are they new? What is their track record, can I see previous projects where they have made 20%+. If you research EOS armchair investing they promote similar figures, however they have not yet completed one project, high risk IMO.
MTR
I guess they manage the development or employ a project management company and you provide a deposit which will differ depending on the size of the project. This is similar scenario to what EOS armchair investing in Perth is promoting.
These are my concerns/risk:
You have no control over the project, in other words if the budget blows out for whatever reason you will be wearing it and instead of a profit it could possibly be a loss.
What happens to your deposit? Do you actually own anything, would need to seek legal advice on the finer points
Your money/deposit is tied up and this could be in excess of $100K until the project is completed, looks like one project will take 16 months, that's a long time between drinks. I could identify a moving market during this period and make money without the risk.
How long have these guys been involved in developing? Are they new? What is their track record, can I see previous projects where they have made 20%+. If you research EOS armchair investing they promote similar figures, however they have not yet completed one project, high risk IMO.
MTR
I have just purchased. To date there has been some unexpected costs. Communication from the project manager has been good so far
Do you mind sharing these costs?
Project Manager has just informed us that there could be an additional $85000 (split between 8 members).
Hotspotcentral is merely the "marketer" of this (prob not 100% accurate but in effect, they are).
Their fee ($11K + GST) is supposed to be for their expertise in advising locations, and organising/linking you with the developer, legals and accounting. They use (for at least some of the developments) Mainz Devts, project mgt East Coast project mgt (I think part of Mainz). It looks like you can link up directly thru Mainz tho' and maybe save yourself some $$.
The concept however, appears to have some merit. Need to do your due dligence, and be aware of GST implications etc.
Armchair developer - seems to be the current catch phrase...
Their fee ($11K + GST) is supposed to be for their expertise in advising locations, and organising/linking you with the developer, legals and accounting. They use (for at least some of the developments) Mainz Devts, project mgt East Coast project mgt (I think part of Mainz). It looks like you can link up directly thru Mainz tho' and maybe save yourself some $$.
The concept however, appears to have some merit. Need to do your due dligence, and be aware of GST implications etc.
Armchair developer - seems to be the current catch phrase...
Hi everyone,
Michael Fuller here from hotspotcentral.com.au.
I thought I'd shed some light on how this works.
Hotspotcentral are first and foremost a property research company. We write on the subject of research for both YIP and SPI magazine and our DSR data (dsrscore.com.au) is referenced by many thousands of people each month via the yip website, our app (boomapp.com.au) and in the back of the property magazines.
In response to our data subscribers asking for our help in getting them into opportunities we would endorse, we investigated a number of builders, developers and other entities brought to us through our network and settled on Mainz as one option (there is another very compelling one in the pipeline).
Our research helps us pinpoint strong locations based on a scan of over 15,000 suburbs and we then put word out to our partners that we are interested in a project in this area. The majority of Mainz' projects do not meet these criteria but when they do we lock it down and secure exclusivity for our subscribers.
I've had a number of prospective investors look at their projects that we do not endorse (to save $10k as Brian/captkirk) below suggests and then subsequently come back to us. The builder looks at the paper profit upfront , we look at this AND the potential for ongoing capital growth. This is crucial and far outways our fee.
We're also offering a new service under an AFSL whereby investors will be able to acquire a property at cost but without the (current) personal guarantees required on construction funding. There are other fundamental additions we're making to this model which I am happy to discuss outside this forum on a personal basis (mob: 0435 918 136). This revised model removes much of the risk, albeit it quite small, on these boutique townhouse projects.
With regards the $85,000 cost, there is always a risk this can happen. In this case the investors will still be getting a brand new property at substantially less than market value in a solid growth location. This cost was nothing to do with the builder or could not possibly have been foreseen and may impact the final profit margin by a fe percent. Not a train smash given the profit left on the table.
That said, these projects are not for everyone. We're very selective over who we allow into our projects and limit our investors to 30 per annum across a select few projects. Given we have 10,000+ subscribers on our database we can be and should be.
If you want to read what we have said about this model and our research methodologies in our various articles and columns in the property magazines then please visit hotspotcentrel.com.au/about-us/media-room/
Just for the record, Rich Harvey is not involved in these projects or hotspotcentral as mentioned above.
Hope this info helps a bit.
Regards
Michael Fuller
Michael Fuller here from hotspotcentral.com.au.
I thought I'd shed some light on how this works.
Hotspotcentral are first and foremost a property research company. We write on the subject of research for both YIP and SPI magazine and our DSR data (dsrscore.com.au) is referenced by many thousands of people each month via the yip website, our app (boomapp.com.au) and in the back of the property magazines.
In response to our data subscribers asking for our help in getting them into opportunities we would endorse, we investigated a number of builders, developers and other entities brought to us through our network and settled on Mainz as one option (there is another very compelling one in the pipeline).
Our research helps us pinpoint strong locations based on a scan of over 15,000 suburbs and we then put word out to our partners that we are interested in a project in this area. The majority of Mainz' projects do not meet these criteria but when they do we lock it down and secure exclusivity for our subscribers.
I've had a number of prospective investors look at their projects that we do not endorse (to save $10k as Brian/captkirk) below suggests and then subsequently come back to us. The builder looks at the paper profit upfront , we look at this AND the potential for ongoing capital growth. This is crucial and far outways our fee.
We're also offering a new service under an AFSL whereby investors will be able to acquire a property at cost but without the (current) personal guarantees required on construction funding. There are other fundamental additions we're making to this model which I am happy to discuss outside this forum on a personal basis (mob: 0435 918 136). This revised model removes much of the risk, albeit it quite small, on these boutique townhouse projects.
With regards the $85,000 cost, there is always a risk this can happen. In this case the investors will still be getting a brand new property at substantially less than market value in a solid growth location. This cost was nothing to do with the builder or could not possibly have been foreseen and may impact the final profit margin by a fe percent. Not a train smash given the profit left on the table.
That said, these projects are not for everyone. We're very selective over who we allow into our projects and limit our investors to 30 per annum across a select few projects. Given we have 10,000+ subscribers on our database we can be and should be.
If you want to read what we have said about this model and our research methodologies in our various articles and columns in the property magazines then please visit hotspotcentrel.com.au/about-us/media-room/
Just for the record, Rich Harvey is not involved in these projects or hotspotcentral as mentioned above.
Hope this info helps a bit.
Regards
Michael Fuller
how's the project going now?
do you pay stamp duty on the unit at the end? any issues (ATO wise) that the company in effect sells the units to you at under market value, thus foregoing profit, and hence no tax?
Just wondering if anybody uses their Boomtown app DSR score religiously to search properties?
Also wondering if anybody has purchased one of their pdf books and thought it was a good read? I got a 'deal' in my inbox to purchase 'How to Find Your Own Property Hotspots (PDF)' for $57.00 minus a 20% discount. Just didn't know if it was worth the money or not.
Any advice would be great. Really looking to pick up on my investment journey.
Also wondering if anybody has purchased one of their pdf books and thought it was a good read? I got a 'deal' in my inbox to purchase 'How to Find Your Own Property Hotspots (PDF)' for $57.00 minus a 20% discount. Just didn't know if it was worth the money or not.
Any advice would be great. Really looking to pick up on my investment journey.
DSR is from DSRdata.com.au not Hotspotcentral
The Demand to Supply Ratio comes from DSRdata.com.au. It was built by Jeremy Shepard.
He says Michael Fuller had nothing to do with creating DSR. But Shepard gave data to boomtown in some old JV.
He said Hotspot central is not really a researcher. It is marketing developer product.
When shepard was working there Fuller had never even bought a property in Australia! He reckons he is "poorly qualified" to research.
I reckon if they get a comission then they are biased anyway.
The Demand to Supply Ratio comes from DSRdata.com.au. It was built by Jeremy Shepard.
He says Michael Fuller had nothing to do with creating DSR. But Shepard gave data to boomtown in some old JV.
He said Hotspot central is not really a researcher. It is marketing developer product.
When shepard was working there Fuller had never even bought a property in Australia! He reckons he is "poorly qualified" to research.
I reckon if they get a comission then they are biased anyway.
