Investors Forum – Report

Hi Guys

Well I survived the meeting. Spent 2 1/2 hrs glued to my chair. Luckily it wasn’t too hard the seat that is.

Here are a number of comments and thoughts about the presentation.

He started by presenting some facts and figures designed to frighten us to whether there will be any superannuation available when we retire. Therefore we will have to create some wealth for our retirement and what better than to use property.(ha,ha)

He then proceeded to use figures showing how
property doubles in value every 10 yrs or so.

Now this is where Investors Forum step in. This organisation sources property in HIGH CAPITAL GAINS areas and sells to investors.

These properties are rated as AAA by banks and therefore will qualify for an 80% loan.
They will basically look in cities of 100,000 people or more. These cities include some areas of Dunedin, Queenstown, some areas of Christchurch, Wellington, Hamilton and Auckland. Also Napier and Taupo are coming into consideration because of high growth.

They consider areas where people want to live and therefore will pay a higher rent.
Design them with the tenant in mind.
Purchase from the developer at wholesale.
And offer incentives to the tenant(subsidy and savings)

These areas include being near hospitals(for doctors etc to rent) and on the fringe of CBDs(lawyers.)
They work with developers and onsell the apartments to investors.
Figures like these were used:
Cost $400,000
10% Deposit $40,000
Negioated discount from 10-30% $40,000
Deposit held in Solictors account until completed earning 4% int.
On completion 18mths to 2yrs later apartments revalued say $450000.
Bank lends 80% of new valuation $360000 therefore you now have about $90000 equity.
The presenter had the gift of the gab with the figures.
From what I can see the whole system depends on capital gains and that the tenant will be paying the high rent required to fund the loan.

Also being new there is high depreciation able to be claimed and therefore a high tax refund.

Line of Credit was also mentioned and how to use it to your advantage.

Memership of Investors Forum involves a once only fee of $3500. This is for all the family and entitles you to attend all their three day seminars. However after the first seminar you will be liable for a fee of about $150 for food and expenses.
Also you are entitled to mentoring and appointments with tax and financial experts.

One development in Takapuna on the North Shore of Auckland called Shoal Haven is now nearing completion. This building has 133 apartments all presold to Investor Forum investors.

Pounamu at Queenstown has recently started to be built.

It took him 1 hour before he asked for questions
We had a form to fill out if we required another meeting. We have required another meeting.

I don’t think I have enough equity to be able to buy into the scheme AND it is very dependent on capital gains.

I hope this long ramble can be understood.

Regards

Hi Amit

No not an old guy. This one lives in Taupo and was once a Baptist Minister.

Sorry it was so long, we sat still for a long time.

You had to be quick to write things down. He used a whiteboard and markers and kept rubbing it clean.

The $3500 fee seemed to be reasonable but I would need more info to consider it further. Anyway I haven’t got that sort off money unless I send the wife out to work and also get her to stop smoking.

Regards