This is an expensive and painful lesson, it clearly indicates that commercial investing needs very carefull DD before signing the dotted line, in this instance could the purchaser not found out what the likely rent could have been from a company who leases on behalf of investors?
Surely this is not hard to find out, would have also uncovered the true return.
Quite right FH – for some reason some investors blind themselves to the truth because of their desire to purchase – no matter what.
Time and again you see how smooth talkers seem to hypnotise people into opening their wallets without thinking of the consequences. In fact they go out of their way to avoid being questioned on the matter at all.
What seems to be happening is that people love to dream and buying the dream is a close as they can get to the reality.
Much like buying a lotto ticket where the chances of winning are virtually the same whether you buy the ticket or not.
Look at the people who fell for the BlueChip con-job, the Nigerian letters, the acia fruit juice franchise or the US tax liens rort.
And if you warn them they accuse you of being a dream stealer and resent you for it.
Olly, I appreciate your honesty on this subject. And having your post bring this out for people to see what can go wrong when you go into property investing without proper research is really great for newbies starting out.
I was fortunate enough to find people who I trusted to ask for advice when I first started out. It took me a while to decipher which information I was being shown was good and suited my style, and for me is very important in deciding which stategy to use and who you decide to get advice from. I read a book recently and it said many people often shout loud statements but if you really listen its what they dont say that tells you about there real motivation, listen for the little things and you will uncover a lot about a person.
I believe that many people like you say see the dream and it somehow blinds there common sense, instead of taking a step back and really looking at what they are getting themselves into. I made mistakes in my investing but look back on them now and are gratefull for them, I now know what I wont do next time, I will live to invest another day, but I think if I lost huge sums of money it may have dented my confidence too much. Then again how big a lesson would you learn from losing lots, quite a big lesson I think.
Anyway getting way off track, just wanted to say thanks for all the great replies, it is great to read thru them and pick out what is relevant. We need more positive posts like this one to help us move forward.
Keep up the good work. FH