Empower Education News - June 2009                                        Back to the home page Dodgy Dealers - what to look out for Olly Newland's Column, 18 June 2009 PROPERTY IS, by its very nature, a big ticket item. It's no wonder then, that the property game attracts a variety of scam artists and fraudsters, as well as those who just push the ethical envelope whenever they think they can get away with it. We have all seen or read the suffering of those who have been caught up in dodgy deals. The likes of BlueChip, Merlot Investments, and the real estate agents from the respected firm of Barfoot & Thompson who abused their position in a multimillion dollar mortgage scam -- to name a few. As unappetising as it may be, it's necessary for you as an investor to know how to recognise the 'dirty tricks' of the property game. A little knowledge -- and a vigilant mindset -- will help you stay out of the clutches of those who would do you financial harm. Pay attention, lest one of these type of deals is ever presented to you. Property finders and Sandwich deals Traditionally, property finders -- sometimes also known as buyer's advocates -- are licensed real estate agents who specialise in seeking suitable properties for their clients, who may not have the time or inclination to look for themselves. This is a legitimate and very useful service and is widely respected, especially overseas in larger markets where the selection is enormous. In New Zealand this profession is fulfilled by local real estate agents on a smaller scale. Unfortunately, scam artists have climbed aboard in NZ and, trumpeting themselves as property finders (although NOT actually licensed agents), are playing a game called 'sandwiching'. Their objective is to simply insert themselves between a legitimate seller and a legitimate buyer with the aim of picking up a quick profit. Some even hold themselves as 'property educators' or wealth 'coaches' ... but they are not the least bit concerned about the welfare of either party, nor any stress and suffering they may cause. Most importantly, their scheme is designed to carry no risk to themselves -- to the disadvantage of the vendor, these 'traders' don't have the slightest intention of ever buying the property themselves. How it works.... Read the rest of this column ADVERTISEMENT: Olly Newland Personal Mentoring Programme Olly Newland provides a personal one-on-one consulting mentoring service for people interested in making progress in property investment. With more than 45 years in the property game, there are few investors who wouldn't benefit from his insight and experience. Olly's services are impartial, independent of any real estate agent or sales organisation, bank or other lender. Unlike some who purport to offer similar services, he does NOT broker real estate 'bargains' (houses, apartments, or developments off the plans) or other related services. (i.e. he's not a spruiker). Olly is upfront and he offers sound, road-tested advice, robust counsel and -- sometimes unorthodox -- troubleshooting. He offers a limited number of people at any one time one-on-one totally private consulting and mentoring by phone, email, Skype video and face to face meetings. If you're interested in knowing more, visit Olly's website www.ollynewland.co.nz or email him omn@ollynewland.co.nz. COMING SOON... Learn the language of business POWERFUL Accelerated Learning programmes on understanding the numbers vital to your success in business and investment. We're happy to be bringing you a real breakthrough training programme by Peter Ho... one of the most entertaining accountants you'll ever meet! A Chartered Accountant with over 20 years' experience, Peter is extensively trained in Accelerated Learning techniques. He has worked in large organisations like Hewlett Packard, IBM, Air New Zealand, BP, Shell Oil and BHP Steel as well as government departments and with small and medium sized businesses. Using Accelerated Learning methods, Peter explains the elements of financial literacy, Accounting and Finance that every business person needs to know. Over the last 18 years he's led programmes in New Zealand, Australia, Malaysia, Singapore, Thailand, Philippines, Indonesia, India, Japan and China. In a high energy, colourful, simple and fun learning environment, you will: - Discover the most essential elements of business. - Understand accounting jargon. - Find out the best way to communicate effectively with your accountant. - Be able to use, understand, and interpret your Financial Reports. - Know the impact each decision has on your Profit & Loss, Cash Flow and Balance Sheet. - Be able to create the Financial Statements that you want. Peter specialises in developing and designing financial literacy courses for non-accountants -- people who need to gain financial knowledge quickly, so they can confidently and effectively deal with financial events and situations in business. With a unique blend of Accelerated Learning, NLP and financial literacy, Peter will show you how to thrive in the current business climate; to know and understand how Profit & Loss, Cash Flow statements and Balance Sheets interact ... and how each action/transaction affects your Financial Statements. If ever there was a time to get your head around 'the numbers' it's now! Peter's work makes a difference, and we are proud to be bringing it to Empower Education clients. Please note: There'll only be a limited number of places on the first course. If you're interested, and want to make sure you get full details as soon as possible use our Feedback form to send us your contact details. This is a great opportunity to learn powerful, important skills from a master instructor. NEW! Learn how to use MYOB - courses from Withers Tsang CHARTERED ACCOUNTANTS Withers Tsang & Co are running a series of courses for people in business who want to save time and learn how to use the popular MYOB (Mind Your Own Business) financial management software. The courses are led by specialist Withers Tsang & Co staff who are qualified trainers of MYOB software. These practical hands-on training courses are limited to small groups to make sure there's time and space for each participant to confidently gain the skills being taught. (Computers are provided for each participant for use during the day.) Two course are being offered this month -- they're held at Withers Tsang offices in Ponsonby, Auckland City -- and more will roll out throughout the year. Highly recommended. Satisfaction guaranteed. You can book your place(s) through Empower Education. Full details here. Check back regularly to see other topics as they're offered. Getting a shoe-in The welcome return of vendor finance (if you do it right) and some thoughts about 'the slowdown' from someone I respect by Peter Aranyi author: Commercial Real Estate Investors Guide and editor: How to Survive and Prosper in a Falling Property Market SOME PEOPLE (including some who've made a living peddling property to others) seem to be just learning, or didn't appear to fully realise that a property slump is NOT a separate incident from a general economic slump. The reason property sales volumes and values fall isn't because a hand on some big cosmic clock ticks over to 'SLUMP' -- it's all intimately related to the economic cycle... the world economic cycle. How does that affect commercial landlords? Well, bearing in mind I'm not an economist's elbow, here goes: As job losses and company closures occur (each redundancy and collapse heralded in the news), and investment finance firms collapse, funds get frozen and banks turn harsh and stoney-faced, people's confidence fractures. As each hammer blow strikes, they hold back more and more on purchases, businesses retrench or delay expansion and hunker down. Less shopping translates into less business, which affects retailers, manufacturers, importers, and the various elements up and down the economic food chain -- including commercial landlords. Those landlords who have left it until now to sell their retail unit/warehouse/workshop/you-name-it are, given the circumstances, probably willing to sell at a bit of discount. (In most cases, it's a good bet that the desperate are driving the market.) OK, that's a bit tough for them. But if things are spiraling down, and the bank is sending alarm signals and reaching for a fresh valuation to justify their loan ratios, well, you may be better to get out before it gets worse. A friend of mine was in just that situation and sold his business and (until then) owner-occupied workshop for a price that gave him a haircut but not a bath. There's a big difference between a motivated sale, a forced sale and a mortgagee sale, as Olly Newland pointed out recently. The collapse of 2nd tier finance, and the general reluctance of the banks and lenders to finance commercial property purchases has changed the game for budding commercial investors. In Commercial Real Estate Investor's Guide we spend quite a bit of space talking about alternative sources of finance and the importance of your approach (and mindset) when pursuing it -- and how the banks/lenders undergo a 'personality change' as the market slumps. Let's say you wanted to buy. You're faced with a few challenges: ... Read the rest of this article NEW BOOK: How to Make Money from Property Create wealth in a falling and rising property market by Gary McCausland Experienced property investor & developer and presenter of UK TV programme How to be a Property Developer Order your copy or find out more here I RECOMMENDED THIS BOOK when I was still half way through it... and we've had such a run on it, my manager Julia passed on my own (pristine) copy to someone -- before I'd finished it! Look, I don't have a reputation for being gushy, but I DO like books written by people who have the experience to actually teach you how things are -- and how to get ahead without blowing a gasket. (That's why I like Olly's books and why I'm so proud of Mark Withers and Tony Steindle's Property Tax and Property Law books -- they're the real deal by people who know.) In the same vein, Gary McCausland's book is WELL WORTH A READ. (Was that too much hype?) We've taken two shipments from the publishers and they've run out again (!) so, while we have stock, get your order in. I spoke to the publishers rep (OK, gently hassling him to import more stock) and he said our sales have burst their expectations for the book. Maybe they thought the credit crunch would reduce the need for good practical advice like this -- but just the opposite has happened. In my view: it's time now to be very careful and get pointers from people with a few clues -- not the cowboys trying to rapaciously lure you into their clutches. As someone said: 'Box carefully, but keep boxing.' Visit our website to order your copy... (you know the drill, limited stock, first in first served ... I just can't change the laws of physics.) NEW BOOK: After the Panic Surviving bad investments and bad advice by Gareth Morgan The latest from the best-selling author of Pension Panic Order your copy or find out more here IN HIS NEW BOOK After the Panic, Gareth Morgan outlines the problems with financial investment (paper) products that have collapsed. He discusses the reasons behind the "structurally sick" savings and investment sector -- and looks for the best path for investors to take today. Described as a 'must-have book' by investment advisors from every corner, this book is especially suited for anyone considering what they should do with regard to their superannuation, Kiwisaver ... or investments of any kind. See the NZ Listener preview available at our website. Dr Gareth Morgan is CEO of Gareth Morgan Investments portfolio manager, and chairman of and a consultant to economics consultancy Infometrics Ltd which he founded in 1982. He is also a well-known columnist, a television debater and a sought-after conference speaker. Visit our website to order your copy... for immediate delivery. IN KEEPING WITH OUR MISSION and values at Empower Education, we're offering a few resources and opportunities for you to connect with genuine experience ... and get some impartial, relevant information to guide you in, let's face it, pretty exceptional times. Property Investment: Your Questions Answered A LIVE recording of Olly Newland, Mark Withers, and Tony Steindle. This two CD audio programme (recorded in April 2009) offers you some up-to-date, straight-talking advice on important aspects of successful property investing...TODAY. Order here CRITICAL UPDATES - audio CD set by Mark Withers & Tony Steindle Essential advice, rules and warnings for safety and success... in TODAY'S market from the authors of Property Tax & Property Law - New Zealand Investor's Guides. Order here Today's handbook: How to Survive and Prosper in a Falling Property Market - Andrew King, Mike McCombie, Mark Withers & Tony Steindle. "These highly qualified authors have put together a very interesting and I think valuable suite of thinking that anyone can benefit from, given the state of play in the property market ... enlightened, thoughtful advice based on expertise and experience." - Hawkes Bay Today. Read the full review. Order your copy here Browse our full online catalogue. LAST WORDS Find a way to benefit from the experience of others you can trust. Get them (or their information) into your circle of influence. If we can help, great. That's what we aim to do. Best wishes, Peter Aranyi Empower Education 18 June 2009 P.S. If you'd like to share some feedback about these thoughts and ideas (or some thoughts of your own), your comments are very welcome. Please use the feedback form. 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