More inflated figures in API Magazine

[undercover]

Yet again an article (Young Gun) in the new April 2012 edition has inflated figures.

Nothing against the young gun himself, but does API even check “The Numbers” ?? or reseach before they print

The two houses (development site) talked about in the article was refused by VCAT last year, yet the article does nothing but talk up the plan + permits etc. It has no planning permit. The land has enforcment proceedings also due to illegal building works (with the additonal works to get more room/rent).

Those ‘block’ of units in Ringwood are all under the one roof line with fire walls and tiny carports running down the driveway, they are also about 65-70sqm in size and at least 30 years old.

These are valued at 380K each.

380K in Ringwood today would get you a 10 year old full detached 2-bed room unit with garage and all the mod cons etc. or a brand new apartment next door to eastland.

Stop wasting my money on bs figures and misleading half written artciles.

 

[beary17]

For those that have read this months mag, I have a question regarding one of the articles. I dont have it in front of me but there was an article about a lady who bought a house, built 2 houses at the back and after sale is expecting a profit of approx $120,000 in 12 months, which is also a 19% return on her investment.
What i cant figure out from reading the article is wether she borrowed the entire amount for the development, (over 1 mil), and if she did, the figures dont include interest payments over the year, which if she borrowed the full amount would wipe out a significant amount of that profit.
If she funded it in cash then great for her but if the full amount was borrowed it doesnt seem a profitable exercise after interest is paid.

Hope that made sense!

 

[coastymike]

Many of these articles contain distorted figures otherwise the truth wouldnt sell. Remember as well people who appear in these magazines are usually seeking some of praise or something to make them feel good. As someone once said to me if you have truly made it you want as little people to know about it as possible. Anyway most of those articles rarely include holding costs

 

[JWR]

Yeah I was a little surprised at how Jun's portfolio had pretty much doubled in 3-5 years when he only did a cosmetic reno in Melb which has stagnated for last year or two.

I thought he was a genius but obviously the vals are too high.

 

[dan c]

Yeah I was a little surprised at how Jun's portfolio had pretty much doubled in 3-5 years when he only did a cosmetic reno in Melb which has stagnated for last year or two.

I thought he was a genius but obviously the vals are too high.

Just wondering if the mag does independent valuations for these articles?

If they are relying on the owners giving a valuation, it's no wonder they are high.

 

[Aaron Sice]

its a property magazine promoting property.

why would it NOT be optimistic?

 

[Corey Batt]

its a property magazine promoting property.

why would it NOT be optimistic?

To attempt to provide even the thinnest level of legitimacy, so as to not offend anyone who has a clue.

However, much like the tabloids, fiction sells to the masses much better than fact.

 

[marg4000]

What i cant figure out from reading the article is wether she borrowed the entire amount for the development, (over 1 mil), and if she did, the figures dont include interest payments over the year, which if she borrowed the full amount would wipe out a significant amount of that profit.
If she funded it in cash then great for her but if the full amount was borrowed it doesnt seem a profitable exercise after interest is paid.

Hope that made sense!

If it was funded by cash then you have to take into account the loss of interest on that amount for the period it was tied up in the development. $1M at 6% is $60K which also wipes out a large part of the profit.
Marg

 

[Melbournian]

can't say about the rest but when i was on API twice- my figures were all correct and not just equity figures.

my capital gain was based on sold properties (before tax and after all expenses) - no assumptions or valuations about it.

 

[JWR]

Do you get paid to appear in API Melbournian?

 

[Andrew_A]

its a property magazine promoting property.

why would it NOT be optimistic?

I enjoy reading the magazines but they are to be taken as mildly optimistic.

Also fair to say they are promoting property as the placement of adds is definitely contextual and there is plenty of advertorial copy. Would love that final full page commentary each month but the advertising budget isn't quite there yet

 

[Aaron_C]

Do you get paid to appear in API Melbournian?

You don't get paid but it's good for exposure.

 

[undercover]

Looks like just about anyone can be "Millionaire" thanks to API

 

[Fudge]

its a property magazine promoting property.

why would it NOT be optimistic?

Just like some of the bogus adds in there as well!

F

 

[JWR]

yeah so many ads - they should be giving it away for free!

Even all the columnists are plugging something in each article!

 

[Aaron_C]

yeah so many ads - they should be giving it away for free!

Even all the columnists are plugging something in each article!

Haha - people gotta make a living you know

 

[D.T.]

You don't get paid but it's good for exposure.

Why on earth would an investor want exposure??

 

[Aaron_C]

Why on earth would an investor want exposure??

Many, many reasons. If they run a business (related to property or otherwise), there's no such thing as too much (good) exposure.

 

[JWR]

Yeah exactly its a free ad for those that appear.

If it were free there would be much greater circulation and then scope to increase paid ads by a lot and possibly a bigger sized magazine with more ads or bi-monthly mags etc... - and therefore more profits for them.

 

[Melbournian]

Do you get paid to appear in API Melbournian?

nope but since i was asked and i had a lot of good photos and a different way of doing thing i went ahead.
not really keen on exposure as i like to do my own thing now.