Investors Club

[Ross Sondergeld]

Reply: 2.1.3.2
From: Ross Sondergeld


Hi,


Did anyone read the testimonials on the investor club web site. What a load
of absolute rubbish! People were saying one thing... and it was contrary to
fact and law.

Are people that gullible or is the Investors Club that well organised?

Anyway, here's #2...


2. Who does the Investors Club represent? Buyer or Seller?

"...the Club protects its member's (the purchaser's) best interests."
(- Testimonial from Barry Atkins, IC National Branch Manager)

Hmmm... Firstly, the IC has an active real estate license (the last time I
checked), therefore they are licensed real estate agents in Qld. Anyway, the
IC does enter exclusive seller agency agreements and/or they sell their own
properties... therefore they are the seller's agent.

As the seller's agent they owe their "client" the seller, fiduciary level
service. (Source: The Law of Agency) For example, they owe the seller a duty
of loyalty, obedience, disclosure, confidentiality, reasonable care & skill
and accountability.

And the buyer is owed a duty of "fair and honest treatment" !!!

Essentially, they owe the seller a duty of absolute LOYALTY and they must
act in the BEST INTERESTS OF THE SELLER at all times.

But now I'm confused?

The national branch manager said, "the purchasers best interests" !!!

Therefore... who does the IC work for? The buyer or seller?


Even the Investors Club are a little confused.




Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast [email protected]
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~





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[Ross Sondergeld]

Reply: 2.1.3.3
From: Ross Sondergeld


Hi,


#3 Do Investor Club (IC) members get a good quality
property and do they pay fair market value?


Well, I've got a quite day at work so... I thought I'd keep going.


Ok... let's look at an IC members property acquisitions. (Please note that I
randomly picked this individual from the IC membership.) And i checked the
relevant databases to gather information.



PROPERTY #1. Townhouse bought June 1999 for $160K

The site looks like townhouses from the relevant database. There are 20
townhouses on 7000m2.... Site bought for $373K in 1997.

Sites unimproved value as at 2000 is $373K. But lets say the land value
today is $600K... now that's $30,000 per townhouse. (* Rough estimate only).
Therefore the property has a low land content value.

All twenty townhouse buyers paid nearly the same price during the same
period in 1999. (i.e pre brisbane BOOM period.) No resales in development.

OTHER RELVANT SALES FOR INTEREST. A freestanding house a few blocks away was
bought at the same time for $116K in mid 1999. Resold mid 2001 for $165.
Land 612m2... unimproved value $56K... FMV for land about $100K ish. Land
contect value 64%. Looks like a nice, safe investment property.


DECISION... IC property an absolute dud. Poor future capital growth as their
are plenty of townhouse sites surrounding the area. Buyer paid a premium...
and the entire complex looks like it sold to IC members.



PROPERTY #2. 6 pack unit bought mid 1999 for $154,000

No acquisition date of 6 pack recorded. Land size 810m2. Unimproved value
$212K as at 2000. Let's say $300K market land value. And let's assume that's
$50k per unit. That's a 32% land content ratio. In addition, everyone one in
the complex paid the same price in the same period. It also looks like all
sold to IC members.

NOTE - It appears that a free standing house sold for $137K in teh same
street, during the same economic period a year early. i.e. teh same market
value period.


DECISION. Without even seeing the property... I'd say a big time dud
investment. In 10 years time, it will still be worth the same amount of
money. No growth... and a dude. Personally, i won't even have bothered to
even drive past.



PROPERTY #3. 6 pack unit bought for $129,500 in late 1999

Ahhh yeh... here's a classic "wood duck" deal. Original 6 pack bought for
$430K in early 1999. Each unit sold for the same price during the same
period, except one for $20k more. (i.e developer to investor) Unimproved
value $155K in 2000. SO let's say land content $240K or $40K per unit. Land
content value 31%. I'd like to know who sold them... because this company is
always coming up... ?????????????????????????

Comparable sales. Well next door's 6 pack sold for the same money a year
later. But teh same seller sold all teh units for the same price in the same
period. ????????? Something's not right here....

I better not comment anymore on this one...


Decision. Thumbs down. Big time dud. Can someone really get SHAFTED 3 times
in a row? On three different properties... ????????????????????



PROPERTY #4 Townhouse (1 of 85) bought 123K mid 2000


Unimproved value of the site $380K. So let's say FMV of $1m... but i better
bump it up to $1.5 million, otherwise the investors... will have almost NO
LAND CONTENT. That's $17,000 per townhouse. Land area 2.8 HA.

Sorry... but i've said enough.


DECISION. I'm not even going to comment.



Well... that's one happy Investor Club member. Bought 4 properties. In a few
funny deals... Ok, everything was bought pre brisbane BOOM therefore they
paid $566,750 in total and today there worth + $???,000

Well... I'd say if they'd bought a few half decent properties they should be
worth at least 30 to 50% more, even 100% if they were a savy investor.

But if the investment forum shouts me a few bucks... I'll get an independent
licensed valuer to value the properties and i recoken they'll be worth $500K
to $566,750.

Anyone interested? (Remember, i'll be arranging the valuations and i'll
report the results back to this forum when complete.)


(* PLEASE NOTE... THAT I HAVE NOT SEEN THE PROPERTIES AND I AM NOT FAMILIAR
WITH ANY OF THE BRISBANE SUBURBS OR AREAS. I HAVE ONLY DONE A REVIEW OF THE
RELEVANT PRICE DATA FROM A RELIABLE REAL ESTATE INFORMATION SERVICE.)




P.S. To finish I'd like to add... that this Investor CLub member got four
+#$? 0=/> ;{-#% properties. And this was a happy member?



Now that's enough from me today...




Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast [email protected]
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~





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[WebBoard]

Reply: 2.1.3.2.1
From: Dirk Diggler


When I was young and guillable in property investing. (ie when I actually believed you could actually get rich doing neg gearing), I went to an Investor club seminar were the guy spoke for 2 hours on how wonderful investing with them is. When it came to question time, someone asked him, "well how many do you own". The answer, none, zippo, zero.
So my opinion is its the blind leading the blind.