Buy to let property website - legit or a scam?

angelbaby

I'm thinking of investing some money in property and I've come across a few sites which offer below market value properties with promises of rental income.

The two I've spoken to are:

Choices Acquisitions: I was put off them by their expensive fees - basically, you have to pay large amounts of money before you're even allowed to see what properties they have on their books.

Empire Property Group: These seem more promising; you don't pay them anything unless you buy through them, and then it's a £1000 reservation fee and (I think, if I'm remembering correctly) a £3000 finder's fee. Which sounds like a lot, but they apparently hook you up with lettings agents who can find you tenants quickly.

Has anyone used either of these companies, or anything similar? Part of me is thinking "If it sounds too good to be true, it probably is," but then again I know that a growing number of people DO make their money by investing in property and then living off the rent.

Does anyone have any thoughts / advice about this? Thanks in advance!

Pixie5740

Yes people do make money from investing in property and letting the properties out but they don't make a lot of money doing it by having to pay 3rd parties. Those that do make money out of property spend their time researching the best location and property type to buy. They know what kind of tenants they are targeting.

£1k as a reservation fee and a £3k finder's fee? What are Empire Property Group finding you for £3k? Just property, which you can do for £0 using Rightmove and Zoopla or a tenant as well? Letting agencies don't charge anywhere near as much as £3k to find a tenant (I think).

If the properties offered by Empire Property Group are so great, why don't they just let them out and cut you out?

What kind of return are you hoping to get from your investment?

fairy_lights

angelbaby wrote: »

Empire Property Group: These seem more promising; you don't pay them anything unless you buy through them, and then it's a £1000 reservation fee and (I think, if I'm remembering correctly) a £3000 finder's fee. Which sounds like a lot, but they apparently hook you up with lettings agents who can find you tenants quickly.

That's what any letting agent would be able to do!
So you pay £4k to buy through them, on top of the purchase price? That doesn't sound too good to be true at all...it sounds like a plain old scam.

Guest101

It sounds like my next business model!

angelbaby

Thank you for your replies!

I think their selling point is basically that the properties they have are below market value, (usually because the owner needed to sell quickly), so you get instant equity if you want to sell them on immediately. (Judging by similar houses on zoopla etc, their estimates of the going rate are pretty spot-on.)

Both of these companies told me they turn away a lot of the properties they're offered because they want to hand-pick ones in the best areas for growth etc. So I guess you're just paying for the ease of having someone else do the research for you, rather than having to be very hands-on and trawl around the areas (and auctions) yourself. I live in the South east and most of the real "bargain" houses seem to be up North, so I guess I was looking for a shortcut / someone to hold my hand through the process. Back to the drawing board! :think:

Guest101

angelbaby wrote: »

Thank you for your replies!

I think their selling point is basically that the properties they have are below market value, (usually because the owner needed to sell quickly), so you get instant equity if you want to sell them on immediately. (Judging by similar houses on zoopla etc, their estimates of the going rate are pretty spot-on.)

Both of these companies told me they turn away a lot of the properties they're offered because they want to hand-pick ones in the best areas for growth etc. So I guess you're just paying for the ease of having someone else do the research for you, rather than having to be very hands-on and trawl around the areas (and auctions) yourself. I live in the South east and most of the real "bargain" houses seem to be up North, so I guess I was looking for a shortcut / someone to hold my hand through the process. Back to the drawing board! :think:

Wow now you're just copying my sales pitch!

Pixie5740

People wanting to sell properties quickly will do so at auction. Unless they do something silly like use one of those quick sale companies who are probably a subsidiary of the Empire Property Group.

If you are wanting to make money out of letting property then you need to look at rental yield. London and the South East will most likely have the lowest rental yield due to the high property prices but you might see the best capital gains in those locations.

Why invest in property though, especially if you need your hand held? What other investments have you considered?

mrginge

angelbaby wrote: »

Thank you for your replies!

I think their selling point is basically that the properties they have are below market value...

Are you really that gullible?

angelbaby

Guest101 wrote: »

Wow now you're just copying my sales pitch!

:rotfl:

At the moment I've got all my cash spread across ISAs, then in all the bank accounts that have a decent interest rate (not too many of them about). Property seems to be going up all the time (which has made it way too expensive to buy in my area right now) so I was thinking maybe I could make that work with me instead of against me!

angelbaby

mrginge wrote: »

Are you really that gullible?

I've had a look at several of the properties they're offering and the price they suggest as the market value. Then I look at houses of the same general size and description in the same area, to see if Empire have estimated correctly. So far they have always been accurate.

But I haven't bought any yet, so no, not that gullible.

AdrianC

angelbaby wrote: »

Property seems to be going up all the time (which has made it way too expensive to buy in my area right now)

Successful investments are made by buying when prices are low, not high.