The Investors Club

[Dazz]

"He who stands on the shoulder of Giants sees further than the Giants."

Not necessarily. You'd have to check the distance from the shoulder to the eyeball. On a giant this would be a considerable distance. On a really big giant (is there any other kind ??) I reckon a normal person would be less than this distance. In this case, the above quote would be false.

Can't you tell I'm busy....or maybe just hanging around arguing the finer details with solicitors way too much.

 

[Glucose]

I agree, Pud, TIC turned a light on for me regarding using increased equity to buy further property PLUS pay holding costs. I haven't bought through them because their finance broker couldn't help me, whereas my own could. Plus they're big on neqative gearing and most of the properties available through them are only showing 3-5% roi. I'm a bit keen on some positive cashflow myself!
Go to some of their workshops yourself & listen & learn. They're great people to talk to.

 

[Ausprop]

"they're big on neqative gearing"

...negative equity

just throwing this out there and for general discussion... is there really much diff from H Kaye? or a 2 tiered Qld marketing company? If you make money out of the deal do you forgive exhorbitant commissions?

 

[jingo]

"He who stands on the shoulder of Giants sees further than the Giants."

Not necessarily. You'd have to check the distance from the shoulder to the eyeball. On a giant this would be a considerable distance. On a really big giant (is there any other kind ??) I reckon a normal person would be less than this distance. In this case, the above quote would be false.

Can't you tell I'm busy....or maybe just hanging around arguing the finer details with solicitors way too much.

lol of laughs Dazzling. You obviously think in a more abstract way than I do - I would never have thought of that. I was just thinking how clever that quote was and could be applied to investing, until I read your post!!!

Maybe thats why you've got 10M and I haven't!!!

 

[jingo]

I went to on of their meetings once - mainly because they kept sending me magzines with lots of interesting information. They seemed nice enough. However they weren't interested in my investment purchases, and just wanted me to fill out a finance enquiry form.

Because I didn't know a lot about them I was very wary - especially as I'm in Melbourne and they seem to invest a lot in qld. There has been a lot of warnings about investing through companies who buy in qld - anyway I decided not to go through them!

Maybe I should buy one through them one day?? - If the deal stacks up

 

[alexlee]

"they're big on neqative gearing"

...negative equity

just throwing this out there and for general discussion... is there really much diff from H Kaye? or a 2 tiered Qld marketing company? If you make money out of the deal do you forgive exhorbitant commissions?

Personally, I bought my earlier properties through the Investors Club, and they have done pretty well. ANY property would have done well in the last 7 years, but the key is that if I hadn't bought through them, I probably wouldn't have bought anything. I stopped dealing with them after 2003 because the properties on their list just didn't appeal to me anymore (low yields) and I was moving towards houses.

The difference between them and a 2 tier marketing company is that, as far as my research has shown on the properties I saw, the prices they advertise are around market price. At least it's not massively inflated like you see with some dodgy marketing companies.

For my first one, the first thing I asked the guy who showed me the property after we saw it was to take me to a few local agents so that I could compare prices. He did, and the prices were comparable (i.e. they weren't loading up the price just because I was from interstate). A 2 tier scam company would never do that because it would expose them.

However, that is not to say all their properties are good. In 2003 I bought one from them where the valuation came in at 10% below the purchase price. I had the option to pull out but I went ahead. Returns have been flat for almost 3 years (but then my next property was in Perth that returned 100% in 3 years). It's about averaging. If I hadn't bought that Brisbane one at the peak, I would have broken my momentum and wouldn't have bought the Perth one.

Treat them as what they are: agents who also teach you the basics of property investment. Go to the meetings to learn: you don't have to buy anything if you don't want to. I knew nothing about IPs before going to the IC meetings, and they started me on the road. However, now that I have a little bit of experience, I don't need as much hand-holding and I can do it myself.

They ARE big on negative gearing, mainly because their business model depends on new developments. Sourcing older properties wouldn't be cost-effective, presumably.

Could I have done better without them? If I knew then what I know now, yes. But I knew nothing about IPs then. Would I have started buying IPs if I hadn't gone to their meetings? Who knows.
Alex

 

[straight]

the actual quote was from Isaac Newton...
If I have seen further it is by standing on the shoulders of giants.. with small heads.

i added the small heads part.

perhaps this one works for you in an investing sense...

Words are dwarfs, deeds are giants.

apparantly its a Swiss Proverb...

 

[Sailesh Channan]

I believe IC are doing a great job introducing ordinary people to property investment. The properties are sold at market values so the investor in not buying properties at inflated prices.

We have sold a number of our client developments through IC and are very happy with thier service. The commission they charged us is 5% plus GST...this is over REIQ but is designed to cover the marketing costs they incur to source clients.

However, if an investor approached us directly or through one of the local agents we sold our properties at a discount to account for the lower selling cost.

 

[urban cowboy]

They are just like every other property sourcing mob - except they are a hell of a lot bigger than most...

they charge the developer a marketing fee to take the properties to the client and recommend the properties to their investors...simple concept and they must be congratulated for they way its worked...whether you like them of not.

personally i won't use them because i don't think that i need to - but saying that there are a lot of first time investors that can and have learnt a lot from them...if its the only way you are going to get started then, so be it.

Where I see them having problems is when the markets are hot...i was on a development site in Zillmere (nth brisbane) this morning and the developer told me that TIC had been chasing him for weeks for a couple of his blocks but he won't give his stuff to them at the moment because REA's are doing just as good a job unloading his stock at half the cost to him (Standard 2.5% comms and no 2-2.5% marketing fee).

from a sales side there is very little that they have that you can't get from a standard agent...Perhaps Sailesh's stuff (and i do completely respect him and love reading his posts - there is so much i can learn from you mate!!) and one or two others i know of...but in the norm almost every development we sell we are going up against TIC - sometimes we get the most away (or other agents), sometimes they do...

The reason they don't often touch property that isn't brand new (and i am guessing - happy to be corrected) is that its hard to charge double comms as a marketing fee to the developer as s/he probably doesn't own the block anymore - maybe they do it to the owners - i dont know - it makes sense to me this way though.

regardless of all this - more power to 'em - i relish the competition!!!

cheers
UC

 

[Sailesh Channan]

Where I see them having problems is when the markets are hot...i was on a development site in Zillmere (nth brisbane) this morning and the developer told me that TIC had been chasing him for weeks for a couple of his blocks but he won't give his stuff to them at the moment because REA's are doing just as good a job unloading his stock at half the cost to him (Standard 2.5% comms and no 2-2.5% marketing fee).

UC

I too can see them having problems listing properties in the current market. We used them when the market was quiet over 12 months ago on select properties. Most of our clients are now keeping the finished products and the ones that prefer to sell are being listed with local agents.

 

[Ozsunrise]

Came across a lady yesterday who is looking into using them to sell of the plan- she told me they charge 7% comission, which she is happy to pay- rural area, few REA.

Susan

 

[urban cowboy]

Is she in QLD too???

because that is nearly 3 times the maximum commission that can be charged by an REA - hope its worth it for her...

that's a lot higher than they are charging a lot of the brisbane developers

 

[Ausprop]

I think they get around it by not technically being real estate agents? like their sales reps arent sales reps becuase they theoretically dont negotiate so the paperwork is done directly between the developer and the buyer

 

[urban cowboy]

I'm having one of those days where what you mean and what you type are completely different. We know the way they work well...they charge extra comms as marketing fees and the like - we come up against them all the time in Brissy...

what I meant was that i'm astonished the friend would want to pay 7% when REA comms are capped to 2.5% - that's an ENORMOUS difference across even a small development.

 

[Ausprop]

oh i see! yes if your development is returnign 20% it kinda sinks it. so who is really paying the 7% in the end?

 

[urban cowboy]

exactly...

what tends to happen on the blocks that we get that they are also marketing is that the price is set at...lets go for a recent example:

block of units open listed with a heap of agents for 349k...
TIC come in and say they can sell them off, price remains at 349k, but they are charging extra comms...developers act differently, but this one toldl the agents on the side that they will discount the price on the units so that agents can get more away at a lower price but high enough that it still works out in front for the developers than if they had to pay TIC full comms.

in other words either the developer or the buyer (and sometimes both) pay the 7% - it all depends (usually) on how desperate the developers are to get them away...

we are finding that developers will list with REA's first, sell a few off then give the remaining couple to TIC because it is a guaranteed sale...almost!!!

 

[lbushwalker]

TIC, good for some

A lot of folks seem to be bucketing TIC but those who have used them seem less willing to do so.
My experiences with them has been great. For two years I attended their introduction meetings trying to understand where the sting in the tail might be but instead I gained lots of useful information as well as familiarity with general IP concepts, financing, taxation, and rental issues just to name a few. These things are also to be found in publications such as Margaret Lomas many useful books but somehow talking with ordinary people who have done it was reassuring to a newbie. Eventually I bought a property through them and found the transaction easy and always there were people around to help and assist. Since then I have bought locally some IPs on my own with varying level of success but now investing on the east coast and gone back to using TIC as being outside of my turf it is far easier. I often attend their advanced workshops and still learning new stuff and also social mixing with like minded folks but not tempted to become a support member myself because they work too darn hard for their commissions.
In conclusion were it not TIC through with whom I got started, I would not be sitting here typing this and contemplating my next IP move and early retirement.
None of my work colleagues (some earn heaps more than me ) are in a situation of sitting on accumulating passive income far beyond wage & salary.
Horses for courses, there is no single "right" way of doing things... just ways!

 

[WASP]

If you can get the deals that TIC are getting but cheaper and through a REA or the developer as mentioned sounds like the way to go for me. Problem is finding a reasonable or honest one of both, whereas TIC seems to have a good name amongst its members

 

[chris8959]

Hi, I have 2 properties from TIC and found them to be honest and answer every question I ask. Both properties were listed with REA's above the IC's price ($15,000 & $7,000). They have managed problems with tenants and building faults where the developer and builder would not repair faults, this alone was a great help. After just having valuations done on both we have a gain of $30,000 (1.5 years) and $70,000 (4 months) over purchase price. I don't blindly follow what they say. I research the areas "to death". I have family members who are REA's and with their help short list areas in states where they live. Would I buy from TIC again? Yes but I would not buy if I were not looking at that area already. And yes I have properties that I bought from REA's and direct from developers.

 

[bennos]

TIC The Investors Club

Surely they (TIC) are doing something right, having been around for such a long time (since 1995). I am of the opinion that businesses (or whatever they are referred as) don't get to stick around for a long period if they don't offer consumers a reason to need/want them around. IMHO, being in operation for over 10 years is a good judging stick that ‘it works!’

I went to a couple of their 'intro' meetings lately and found that they seemed to be well informed and was non-pressuring about selling their stock. A lot of people have had success investing in properties through them, surely that speaks volume in their operation.

However... as good as it all sounds at the meetings and their long history in operation I can't help wondering what is in it for the 'support members' and 'branch managers'. They seem to be average mum and dad type people, not sales sharks preaching ‘buy from us or you will lose everything’.

It’s been great to hear from people that have experiences from TIC (investors). But I (and I’m sure others as well) would really like to hear from you the support members, branch managers or affiliates out there that would have read this thread at some time.