Who do we trust? - guru or conman?

Dear Doxa,

1. Trust ourselves, do our own independant market research and due diligence process before we invest;- all these are part of parcel of being a "self-responsible" individual, that John FritzGerald talks about.

2. I have subscribed to John's CWB's programme in 2003 for my own self-education and attended some of his in-house seminars, from time to time.

3. However, I have yet to purchase a single property from his JLF Corporation or/and taken a loan from his Investloan yet, at this point in time.

4. I do not fully agree with Scott McGeever's comments made regarding the CWB's investments in QLD.

5. As a buyer agent, charging his own additional fees for his property investment research/sourcing services for his clients, I would naturally expect that properties recommended by Scott McGeever for his clients, to perform better than being marketed by JLF Corporation.

6. If you have personally read John FritzGerald's book, "7 Steps to Wealth", John does not believe in investing in regional towns, though he does openly talks about investing in the more affordable range of rental properties.

7. As a property investor myself, I do subscribe to John FritzGerald''s property investing philosophy and strategies to a certain extent and I have personally well-profited from his investing pearls of wisdom which he has shared with his audience, from time to time.

8. For your further comments and discussion, please.

9. Thank you.

Cheers,
Kenneth KOH
 
Yeah;
from my experience, the people who market properties to the public aren't doing it to help YOU, they're doing it to help THEM.

The bigger, glossier, impressive the ad, the more they're making.

Doesn't mean you won't make money too if you buy, but you have to wonder how much of your purchase price is funding the ad campaign.

Caveat Emptor.
 
I've attended several of Johns seminars and even done his mentoring program (many years ago). He's a very smart guy with the ability to see the best use of a property creatively.

I've met a lot of his clients who would happily recommend you to purchase properties from him.

There's no chance I'd buy a property from him, because some of the things I learned from him tell me that he's already done a lot of value adding to what he creates. There's little opportunity to value add and make real money for yourself.
 
doxa5 said:
Can we trust anyone today?
I think money is the most important thing on Planet Earth today for some people. Only profit counts !!!

Doxa

http://www.theaustralian.news.com.au/story/0,25197,23039657-25658,00.html
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I don't see what the problem is here - if people are stupid enough to pay way over for a property then they are lazy or ignorant and are unlikely to do something purely by themselves anyway - at least they are being encouraged to do something.

I don't see John as a rip of merchant - I see him as very successful and he recently was invited to a global charity function in the states, in the article he stated he was becoming more interested in his charity then his development business which I am inclined to believe is an altruistic motive.

Tim
 
PT_Bear said:
There's no chance I'd buy a property from him, because some of the things I learned from him tell me that he's already done a lot of value adding to what he creates. There's little opportunity to value add and make real money for yourself.
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Hi PT_Bear

I tend to agree with you on this and like to buy and be able to add value myself. However, it depends on each individuals circumstances, experience and risk level...

Some people want an easy investment. Everything already done for them. They dont want to or know how to add value themselves.

I dont think you can really trust anyone the way you can trust yourself. That's why you have to continue to educate yourself and research the market.
 
I have not attended any of John's seminars however, have read alot of his material and I think he has some brilliant ideas.

All depends on what strategy suits you.
 
Francesca C said:
Some people want an easy investment. Everything already done for them. They dont want to or know how to add value themselves.
Click to expand...

I would hazard a guess and say that this is most of the (investing) planet.

Look how many people are in the stock market and in managed funds.

Not saying they are bad investments, but they are easy to buy, take little time to buy, have little on-going management issues etc.

There's also the attraction of the big win and fast wealth.
 
L.AAussie said:
There's also the attraction of the big win and fast wealth.
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The attraction of PROMISED big wins and PROMISED fast wealth. The reality might be very different.

The irony is that most of the experienced investors on Somersoft, who have done it are the ones who will advocate a more caution. We point out the risks in an investment, so it 'sounds' more 'risky' to newbies. So the newbies think 'this is risky so I won't invest in it', while the 'gurus' keep emphasising the positives and the newbies think 'hey, I don't hear any risks, this must be good!'
Alex
 
I don't agree with the JLF process although the phylosophy behind thier strategy is sound. As long as disclosure occurs ... then why can't someone make a profit from delivering a service (even if it happens to be property investment adcvice)?

We need to be careful that we are not cutting down tall poppies here. many who invest through property seminars are time poor individuals who would not invest at all if not for the simplicity of the 'Package'.

Due dilligence is better than hindsight :)
 
It was Johns book '7 Steps' that got me into property investing.

I haven't purchased a property through them, but did source finance from InvestLoan. I've since moved on to a better deal.

Does anyone else think this is kinda stupid:

"I recently valued two John Fitzgerald properties which the people had bought in 1999 for a total of $380,000 which are now worth $680,000," McGeever said. "But if they had spent $380,000 in (the Brisbane suburb of) Red Hill in 1999 they could have bought a four-bedroom, two-bathroom family home on an 800sqm block which would now be worth $1.4 million."
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Yeah, and if they had have bought a lotto ticket with the numbers 12, 23, 44, 32, 22 and 11 they would have done quite well also.

At a guess I'd say that Red Hill place would be wildly different in terms of cashflow (lower yield plus nil depreciation vs higher yield and new house depreciation) and higher maintenance on an older property. They might not have even been able to hold it for all we know.

The investors have almost doubled their money in less than 10 years. IMO that's not a bad result. Of course a better result was possible elsewhere. This almost always will be the case with any investment decision. Was this something that the average person should have reasonably known back in 1999? If they had not of had any dealings with JFG would have they bought the Red Hill place instead?

JFG has made money from me however I don't have a huge problem with it. He provides a service and tries to make a buck at the same time. I don't feel he is being unethical about it. I'm looking forward to seeing what Neil has to write about him in Stitched.

If it wasn't for his John's first book I don't think I'd be in the position I am in now. It was published back in a time when you had to look in the business section for the small handful of books that were available on Australian Real Estate Investing. They didn't have there own whole section like they do today.
 
I think these sorts of operations (ie. John, TIC etc) - assuming they are not being dishonest - have a place in the market for inexperienced people who don't know or have the time/interest to do it themselves.

If they did have the time/interest to do it themselves they could have, and if this gets them into the market then it's a good start. If they were truely interested enough themselves, they would have done some reading of books and research before or as a result of these seminars anyway. People can then 'graduate' and learn from the experience, and if they desire - do it themselves next time.

It's better they got into the market this way than not at all. Best illustrated by two people:

Person A:
"It's all too hard, but John's seminar helped me take the plunge..."

Person B:
"It's all too hard, we'll just buy the boat we've always wanted and go on that European holiday next year..."

Who's ended up better off in the long run? Person A may then end up buying subsequent IP's themselves after, but Person B still has the mind set that it's too hard and scary.

Would I use one of these sorts of companies - hell no! But they're not directed at me.

As far as them making a profit, well you'd have to be pretty dense to think any business would be operated out of the kindness of they're hearts - of course they're going to make a profit along the line somewhere.

Additional thought: One thing that doesn't seem right, is if the developers etc. charge to attend their events on the premise of teaching you something as opposed to just selling you their own projects.
 
as long as there is a disclosure... TIC purports to be a club yet it is a hugely profitable company. JFG, well if all is disclosed and you still buy then it's your tough luck I suppose.
 
DavidMc said:
At a guess I'd say that Red Hill place would be wildly different in terms of cashflow (lower yield plus nil depreciation vs higher yield and new house depreciation) and higher maintenance on an older property. They might not have even been able to hold it for all we know.

The investors have almost doubled their money in less than 10 years. IMO that's not a bad result. Of course a better result was possible elsewhere. This almost always will be the case with any investment decision. Was this something that the average person should have reasonably known back in 1999? If they had not of had any dealings with JFG would have they bought the Red Hill place instead?
Click to expand...

Spot on DavidMc,

The example is comparing apples with oranges. In 1999, spending $380k for 1 property would have been a lot riskier than 2 properties for $380k. Comparing the two deals without laying out the exact details of the properties and the position of the people buying them is on par with a 'con man'.

I have read John Fitzgerals book and found it to make good general points for investing in real estse. I source my own properties and get my own financing & valuations
 
Actually I remember going to presentation by them as well way back in 2001 or so.

From memory, it was a very reasonable 'content:sell' ratio (I guess I was expecting the big sell). Comparable to any of Yardneys or Zhengs seminars.

Maybe it's different now.

I didn't buy from them, but I used his strategies and did quite well from a few new house and land areas in SE Melbourne.
 
John's ideas are very good and it has helped a lot of investors get into better investments as opposed to new inner city units that fell in value around Melbourne and most cities between 2000 and 2004.

There are always better investment strategies however, for the beginner his strategies are as sound as they come and it can form a good platform for future growth and investment.

John and his organisation makes good money per deal however, he does have a lot of over head costs as well.

These days they concentrate too many investment properties in one estate which is a contradiction to some of his teachings...I guess they are selling too many properties and apparently his business is currently booming.

Good luck to him, he has worked hard for his achievements and he is one of the good guys in this industry.
 
His new book is supposed to come out in Jan. I checked Borders a week ago but it's not in yet. Anyone seen it / read it?
 
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