3 property investment scams

From bogus consultants asking you to sign up to a fictional government program promising financial incentives to an African prince or princess offering you a cut of several millions if you help them get money out of the country, there are unfortunately a lot of unscrupulous people looking for ways to relieve you of your hard earned cash.

The tactics scammers use vary according to the industry and type of people they are targeting.

Unfortunately, there are some scams doing the rounds in the property industry here in Australia – here are a few of them.

  1. Investment ‘clubs’ and real estate seminars

If people are new to property investing and want to learn some more, they will often head to a seminar to get some face-to-face advice. There are some very reputable companies running seminars – and there are some rather dodgy property marketing companies too!

These companies are often selling house-and-land packages or off-the-plan apartments at significantly inflated prices. They’ll also promise you guaranteed rental return for a period of time.

They are out to impress; some even going as far as to pick you up in a Limo! Slick sales people will offer to make your life simpler by suggesting you use their in-house solicitors, financial specialists.

Do not sign anything at these seminars. There will often be something in the small print which will make it costly for you to get out of.

Our advice is, if someone approaches you, or you see an advert or receive a flyer or email of something that is too good to be true, the chances are, it probably is.

  1. Overseas ‘opportunities’

With many people being priced out of the market here, there are some scams offering overseas properties claiming they are in prime locations and in pristine condition.

Unless you are prepared to go overseas to look at these properties and source your own property managers, and have done a lot of homework into the legalities of foreign property ownership in a particular country, we suggest you do not go near these types of ‘investment opportunities’.

  1. Fraudulent emails

Conveyancing technology firm GlobalX has been raising awareness of a particularly sophisticated phishing scam where scammers hack into a conveyancers’ client list, and send out emails impersonating the conveyancer.

The email advises the property trust account details have changed, and unsuspecting clients transfer purchase funds into fraudulent accounts.

Generally, lawyers and conveyancers would never contact clients via email informing them that property trust account details have changed.

If you receive an email such as this, do not reply to it. Contact your conveyancer directly using a telephone number you’ve previously used and ask them if they’ve changed details.

A useful resource is the Australian Government ‘scam watch’ website www.scamwatch.gov.au/. This has details of all sorts of different types of scams and gives advice on what to do if you think you’ve been scammed and how to report it.

With over 40 years in the business behind us, we’ve seen a lot of scams, so we’re happy for you to get in touch and we’ll give our opinion. We love our industry and there are a lot of good people in our industry. Our aim is to ensure our clients have all the information they need so they can make informed decisions and enjoy the benefits of investing in property.

Come on in for a chat or give us a call on 02 4956 9777!

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