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Becoming a BA and providing a Investment Strategist service

Discussion in 'Small Business' started by John Ferguson, 29th Aug, 2016.

  1. John Ferguson

    John Ferguson Well-Known Member

    Joined:
    22nd May, 2016
    Posts:
    71
    Location:
    Hobart, Tasmania
    I was just wandering if there are any BA'S and Property/Investment strategist's on this forum who could provide some information and advice about starting a BA and investment strategist service.

    I currently live in Hobart, Tasmania and I believe there is currently a real need for good BA'S and Strategists in our current climate. I speak to people every week who just have no long term plans for retirement and who just do not even know where to start. I speak to numerous people about investing in property and their idea of a good investment property is just so far from being anywhere near a good investment, it's scary. So many people have no idea, about proper property research and analysis, true ROI on their investment, how to create a plan to meet their needs and goals, how to structure their mortgage (Offset/splits/interest only loans etc.), what to provide their accountant or how to find a good accountant or broker. It is no wonder so many people just do not buy good IP's and give up and sell after 3-5 years.

    There is currently a lot of interest in the Hobart market and there is a real need for a BA, which is what led me to this post. I have worked as a selling agent around 7 years ago and it just wasn't for me, as it was just to sales focused (obviously), but I have also studied the diploma of finance and the cert 4 in mortgage broking and I have been investing in property for about 6 years now and it probably took me about 4 years to learn how to properly invest and identify investment grade properties. I have made a few mistakes and bought some dud's, but I have continued to educate myself and reach out to other investors, listen to numerous podcasts and read relevant info on a weekly basis and now I believe my last three purchases have been investment grade properties and should provide good long-term growth. The first few purchases have definitely been a set back, but I have learnt from my mistakes and implemented what I have learnt.

    I know the importance of making the right purchase early and having a sound strategy in place early, in order to build an appropriate portfolio and I think I can offer a quality service to people in Hobart.

    So if any property/wealth/investment strategists and BA's can provide me with some information and advice about how to get started, any compliance or membership requirements, info on how to charge and collect payments, how to promote the service/business or any info and advice they think could help, I would really appreciate it. Feel free to post on this thread or message me privately.

    Thanks guys!

    John
     
  2. Tony Fleming

    Tony Fleming Well-Known Member Business Member

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    Location:
    Sydney
    I'm becoming a BA are you just focusing on Tasmania? Different states and territories have different requirements. You most likely will need to update your real estate certificate. Feel free to PM any questions. I'm sure the seasoned BA will be able to help as well :)
     
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  3. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Location:
    NSW
    Perhaps see if you can have a chat with one of our Tasmanian REBAA members: My Property Hunter - REBAA

    Also be aware that being a licensed BA does not entitle you under the Act to offer financial or investment advice. You need further qualifications for that.
     
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  4. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    Sydney & Adelaide
    Welcome to the forums!

    Firstly, you will need an appropriate real estate license. Some states like NSW have a restricted license for BA's, others require a full license (like SA). Did you have a full license 7 years ago or just a salesperson registration?

    Secondly to give financial advice you need to be licensed as a financial adviser or partner with one to provide said advice. You could partner and then get a property investment qualification, see Property Investment Professionals of Australia
     
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  5. John Ferguson

    John Ferguson Well-Known Member

    Joined:
    22nd May, 2016
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    Location:
    Hobart, Tasmania
    Hi,

    Yes based in Tasmania. I will have more of a look on the REBBA site and get some more info. I did receive a full real estate license and I have completed the Diploma of Financial planning, so I am compliant to provide advice for about certain financial products etc. but I would need to be registered etc.

    Thanks
     
  6. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

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    Adelaide, SA
    To be compliant providing advice you would need to be under an AFSL - which with the new standards for education required the diploma is likely to be insufficient. As a minimum you would need to have an ADFP or degree in Financial Planning/related degree.

    In any case as it's property planning, you *shouldn't* need to delve into financial advice if you strictly only speak about property, as its not classified as a financial asset.
     
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  7. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Corey is right. You may be qualified to give financial advice, but you cannot do so unless you are licensed.
     
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  8. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I've seen few BAs try to give the 'advice on property strategy' thing. I'm not convinced that any one profession can do it well as it requires coverage from a very broad spectrum of disciplines. Teaming up with complementary professions and collaborating, rather than being a one stop shop would be the way to go.

    Property is also a very long term strategy and many of the components are completely out of control of the advisor and often the client. Sooner or later any strategy is going to be derailed. Ever notice that Nathan Birch has MAP strategy sessions but they never put anything in writing? I can think of a few reasons, but one reason would be to protect themselves from clients implementing the advice outside of their control. This sort of thing tends to be more sales of a sales process rather than a true strategic investigation.

    As a BA, you can control what your client is buying right now. You've got no control over what they do next regardless of how good your advice is. Neither you or the client has any control over the lending environment which any strategy is going to be dependent on.2 years ago I could put together lending a strategy that worked consistently over a 10-15 year period. Those strategies have completely changed today and are going to take quite a lot longer and are more market dependent.

    There's a definite need for BAs in Hobart. I would focus on understanding various investment strategies and what sort of properties will be best suited to meet those strategies. A component of education to clients on various strategies which might suit their profile, rather than an outright strategy.

    Probably the biggest risk of the Hobart market is it's heavily cyclic. Hobart tends to lag behind other booming markets (Melbourne, Sydney, Brisbane) by a few years and it tends to operate in extremes. There might be a very fast growth period (happening about now) and then a very long period of stagnation. The last time I recall Hobart getting much interest was 2001 - 2003. This can be an opportunity as even a stagnant market can present opportunities, but for a BA it can also mean long periods of very little interest.
     
    Last edited: 6th Sep, 2016
  9. JacM

    JacM VIC Buyer's Agent Business Member

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    Location:
    Melbourne, Australia
    Another point to note is that your professional indemnity insurer will wish to know exactly what services you are offering and may not wish to cover you for the advice component.
     
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  10. Jacque

    Jacque Buyers Agent and Bookworm, Sydney Business Member

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    Location:
    Sydney
    Agree 100% @Peter_Tersteeg and I only wish more consumers would realise this. The unregulated "property advice" industry is very much caveat emptor and we always recommend potential clients speak to their lender/broker, accountant and/or FP in collaboration with us when seeking to buy. We are only part of the service and work off a criteria and budget provided to us by the client.
     
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  11. John Ferguson

    John Ferguson Well-Known Member

    Joined:
    22nd May, 2016
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    Location:
    Hobart, Tasmania
    Some great points and spot on about the Hobart market. I guess going down this type of path is very difficult outside the major cities/markets.
     
  12. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    Very good point, my PI policy needs a lot of info for their buyers advocate package.
     
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