Tweet
An open letter to Richmastery.
Dear Richmastery,
I know that you cop a bit of flak on this forum, especially from members like me. Perhaps you could go someway to restoring your good name by providing a clear answer to the following question:
Why is it that so many of your advertisements for your "hot property deals" are misleading?
Take, as just one example, an add that I saw for the first time a few minutes ago.
Why, when I follow the link to the RevIQ report, does it turn out that the property is not CF+ive before tax. Indeed, it is CF-ive to the tune of $3200 PA. And this is assuming the $340 rent per week for the renovated house.
Why, when I look at the RV, does it tell me that the house in its current state is valued at $190K, not $235K. Why does the purchase price turn out to be only $2K below valuation, not $47K as you advertise. Admit it: there is sweet FA "immediate" equity in this purchase.
Why does the researcher's claim that the deposit can be recycled out of the equity in the property not take account of the fact that, by his own admission, between $10-15K needs to be spent on the property.
Why is the investment yield advertised at 9.4%. This assumes a weekly rent of $340 against a purchase price of $188. But the researcher admits that $10-15K needs to be spent in order to achieve this rent. There is no way to achieve the advertised yield - so the advertised yield is not just misleading it is false.
Why does the researcher claim that "This analysis assumes $12500 of renovation costs" when he neglects to take these costs into account when determining the yield or the equity on purchase?
Please don't advise me to take up these issues with the particular property researcher, as you have done in the past. These are issues that you ought to be taking up with that person yourself. I submit that it is the misleading claims of researchers such as this person that give your organisation a bad name.
Yours sincerely,
Paul Flood.
I know that you cop a bit of flak on this forum, especially from members like me. Perhaps you could go someway to restoring your good name by providing a clear answer to the following question:
Why is it that so many of your advertisements for your "hot property deals" are misleading?Take, as just one example, an add that I saw for the first time a few minutes ago.
Originally posted by richmastery
#1215 Gisbourne
PRE-TAX and AFTER TAX POSITIVE potential !! And on top of that RECYCLE your deposit quickly!! SNAP UP This Cosmetically Distressed property could gain yo
Investment Indicators
Pre Negotiated Purchase Price $
Independent Market Value$
Rental Income (Per Week)$
Cash Flow After Tax (Per Annum)$
Investment Yield
Immediate Equity $
Richmastery Fee (Incl. GST)$
PRE-TAX and AFTER TAX POSITIVE potential !! And on top of that RECYCLE your deposit quickly!! SNAP UP This Cosmetically Distressed property could gain yo
Investment Indicators
Pre Negotiated Purchase Price $188,000
Independent Market Value$235,000
Rental Income (Per Week)$340
Cash Flow After Tax (Per Annum)$1,865
Investment Yield 9.40%
Immediate Equity $47,000
Richmastery Fee (Incl. GST)$4,995
Why, when I follow the link to the RevIQ report, does it turn out that the property is not CF+ive before tax. Indeed, it is CF-ive to the tune of $3200 PA. And this is assuming the $340 rent per week for the renovated house. Why, when I look at the RV, does it tell me that the house in its current state is valued at $190K, not $235K. Why does the purchase price turn out to be only $2K below valuation, not $47K as you advertise. Admit it: there is sweet FA "immediate" equity in this purchase. Why does the researcher's claim that the deposit can be recycled out of the equity in the property not take account of the fact that, by his own admission, between $10-15K needs to be spent on the property. Why is the investment yield advertised at 9.4%. This assumes a weekly rent of $340 against a purchase price of $188. But the researcher admits that $10-15K needs to be spent in order to achieve this rent. There is no way to achieve the advertised yield - so the advertised yield is not just misleading it is false. Why does the researcher claim that "This analysis assumes $12500 of renovation costs" when he neglects to take these costs into account when determining the yield or the equity on purchase?Please don't advise me to take up these issues with the particular property researcher, as you have done in the past. These are issues that you ought to be taking up with that person yourself. I submit that it is the misleading claims of researchers such as this person that give your organisation a bad name.
Yours sincerely,
Paul Flood.
Comment