You can hardly turn on the TV at night or on weekends without being bombarded by the hype of how to make a fortune in real estate “even if you’re broke.”
The Federal Trade Commission and legitimate real estate investors say many, and perhaps most, of these “experts” are not to be believed.
John T. Reed, an experienced real estate investor and publisher says the real estate seminar and mentoring business is now dominated by get-rich-quick schemers. A lot of them are run from boiler rooms where the only objective is to sell more seminars, books and tapes to a gullible public, he says.
The only money down you’re likely to see from these “secrets of real estate success” seminars, books and tapes is your own money–down the drain on worthless products.
Of course, some people do make lots of money in real estate, but these are usually the people who have invested years learning the intricacies of the ever changing real estate market and who have the financial strength to be players in their chosen market niche.
Alison Rogers, the author of “Diary of a Real Estate Rookie,” says she learned the hard way how difficult is to compete with the pros. Her competition in the “house flipping” market were mostly professional contractors who knew the market better than she did and had more resources to work with.
Even finding properties to improve and re-sell was a lot harder than advertised–“like looking for a needle in a haystack,” she says. As with almost all financial rewards, it comes down to hard work and knowledge.
The Federal Trade Commission warns consumers to be very cautious of any promise from any guru who makes offers of:
Big money fast, regardless of lack of experience or training
A “Limited time only”offer
A “sure thing”which offers security for years to come
Big financial rewards and a lavish lifestyle for only part time work or easy work from home
Testimonials of rags to riches from seminar graduates or even the organizers.
The FTC says the preventative to being taken in by such schemes is to take your time and go slow, ask lots of questions and get specific, complete answers to those questions. Be wary of testimonials–anyone can pay shills to vouch for them. Get any refund offer in writing and know exactly what it takes to qualify for the refund if the promises don’t pan out. Even then, you may never get your refund if the promoters are not legitimate.
John T. Reed also lists and rates about 130 real estate and financial gurus on his website, www.johnreed.com. As you might expect, the phonies outnumber the good guys by about 3 to 1.
Remember, standing in front of a luxurious mansion or a fancy sports car for a promotional photo or video doesn’t mean the promoter owns it or got it by following advice from a seminar.