Buyers agent + builder + locator + property manager all in one

Discussion in 'The Buying & Selling Process' started by OrionInvestments, 20th Jul, 2017.

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  1. OrionInvestments

    OrionInvestments New Member

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    Hi,

    I am looking to build my first investment property and am looking for advice regarding a company that I wish to take care of the process/stages:
    - Locating a block of land
    - Build from start to end (with their dedicated Master Builder)
    - Obtaining tenants that will not bulldoze the property for a laugh
    - Managing the property/tenants

    Advantages for going with the company (from their mouth):
    - They have access to exclusive information regarding infrastructure planning.
    - Access to purchasing blocks of land before they hit the market.
    - Access to lower price blocks and builds as they build/buy in bulk ie. 50+ properties a year.
    - Ability to invest in property safely without an in depth knowledge of market and does not require much management from the investors side.

    Basically they market themselves as a one stop shop that aims to allow time-poor people to invest in property with minimal knowledge while providing their clients with detailed feedback throughout each stage mentioned above.

    They seem like a genuine, well established company however I am cautious as this is my first time in the market and I could be easily taken for a ride.

    They have said that they make their money from:
    - Build commissions
    - Property management (fees are reasonable)

    I am in the early stages so they are not willing to give away their locations that they build at (I see this as fair), once I have a pre-approval then they know I mean business and they will discuss locations.

    Any advice on what to look out for would be greatly appreciated :)
     
  2. Propertunity

    Propertunity Well-Known Member

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    Appeal is to lazy or newbie investors. One stop shops have the ability to stitch you up. It's better and safer to have multiple pairs of eyes looking at a deal not just one pair with a vested interest.
     
  3. OrionInvestments

    OrionInvestments New Member

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    Once I have all the information regarding location and build plans would you recommend me taking it to another party for review? Or not go with the one-stop shop altogether? I am quite time poor so their pitch is really appealing.
     
  4. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    They aren't a buyers agents, they are a sales person for a developer.

    Be careful not to get the two confused.
     
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  5. Sackie

    Sackie Well-Known Member

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    The whole thing screams added layers of unnecessary risks to me. It makes me cringe.

    My 2 cents.
     
  6. Propertunity

    Propertunity Well-Known Member

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    ^ ^ this IMO.
     
  7. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Convenience can be good

    But just like convenience food - there is a sting in the tail usually

    ta
    rolf
     
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  8. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    A few years ago I had a client who purchased a block of land in a new development. She was using a conveyancer recommended by the company that sold her the land.

    Whilst organising the finance, I noticed a few unusual special conditions in the contract which were clearly to her disadvantage. They were fairly obvious to anyone who's seen a few contracts. I contacted the conveyancer and brought this up.

    The conveyancer stated that she's very experienced and processes over 200 referrals per year from this developer. She doesn't think that these clauses are unreasonable.

    200 deals a year is enough to keep a single conveyancer reasonably busy. Who's interests is the conveyancer really putting first? The client that pays her, or the developer that sends her 200 clients?

    Always make sure that your finance, legal, property management and tax advice are independent of the people selling the property. Avoid one-stop-shops.
     
    Last edited: 20th Jul, 2017
  9. Jasper

    Jasper Well-Known Member

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    Two companies:
    Open Corp
    A Team Pro

    The infrastructure info is not exclusive to them, they're probably just better than newbies at researching it.

    Both have excellent video series, so I'd start with those and see what you think

    I think it's a good idea if you need the learning. I'd just always use my own lawyer, conveyancer etc so there's no conflict of interest.
     
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  10. Scott No Mates

    Scott No Mates Well-Known Member

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    All in one shop removes the competition of each link touting for business ie there's more profit (for them) if vertically integrated.
     
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  11. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    Agreed- use your own solictor/conveyancer, and your own finance.

    That way you've got eyes on the deal that are not linked into the sales process.
     
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  12. DRichoY

    DRichoY Member

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    I'll add my 3c...
    Absolutely agree - the one stop shops are typically developer spruikers (familiarise yourself with this term)
    Personally this type of deal is just not for me.
    BUT if you do go with someone like this, absolutely, break their chain of control and use some of your own people as the above seasoned operators have also said. Independent advice is key.
    Make sure the areas they are recommending have decent drivers (i.e employment centres close by, more than one industry of employment i.e not rural or mining, close to schools, transport and population, and make sure the areas aren't just vacant development spaces miles from most of civilisation.
    Don't pay over median for it either. I suspect you are talking about Opencorp and this is Opencorp's Director, Cam's, philosophy (his book is quite a good read actually). Most prelim data on an area is just a click away on realestate.com.au

    If you need some recommendations of independant people to use i.e brokers, solicitors, there are hundreds of well versed and keen to help investors on PC I have found so just ask.

    Good luck with it.
     
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  13. OrionInvestments

    OrionInvestments New Member

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    Thanks for the advice guys.

    I have decided not to go with them and source my own advisors.
     
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  14. TMNT

    TMNT Well-Known Member

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    for the record, why dont you put up a link to the ad or company?

    the experts on this forum will be able to tell you exactly what sort of compnay you are dealing with and what key points you can see for the future to identify them
     
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  15. OrionInvestments

    OrionInvestments New Member

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  16. Trainee

    Trainee Well-Known Member

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    The whole thing just reeks.
     
  17. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    of ?

    ta
    rolf
     
  18. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Adverts that promote celebrity names ring serious alarms in my mind. I guess I would be asking - Who is paying for these endorsements, website and all these services that make it so easy ??Hmmmm... Usully the buyer overpays and a income stream for all the parties paid by the buyer. Sometimes these deal are over valued and that how parties get their income.

    Tread carefully but it may be OK... But its definately not free assistance !!
     
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  19. Tom Rivera

    Tom Rivera Property Manager Business Member

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    You need to consider the investment on its merits, regardless of who brings it to you and how they're structured.

    In my experience, these one-stop shops tend to be markedly over-priced (I haven't come across AR so I can't comment on them directly though). The packages they sell often pay them commissions of between $30,000 all the way to $80,000 (the highest I've seen!). They tend to work with in house finance to squeeze it past valuation and often build you an under-sized and sub-standard house that disguises some of the extra cost.

    They aim to sell you a lifestyle and retirement plan instead of a property, most people get so caught up in the sales web that they don't even bother to look at what they're buying. All of the advantages you listed are unfortunately almost undoubtedly rubbish and reek of practiced sales script.
    ______________________________________________________________________

    If you spend the little time you have selecting a quality agent that you really click with, you'd be surprised with how many of these things they can organise for you. Of course the ideal situation is to spend countless hours and many months doing your own research, but the reality is that some people just don't have the time. Just be aware that you are increasing your risk profile by outsourcing everything, there are plenty of greedy cowboys in all facets of this industry.
     
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  20. Sackie

    Sackie Well-Known Member

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    Sorry to hear about your troubles. Good lesson learnt and your wiser moving forward. Companies offering 'all in one' are often notoriously known for lacking transparency and accountability. Personally, if 5/5 people told me they had good experiences with such a company, I would still run for hills without looking back.
     
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