Don’t get conned by their marketing – check my definitive guide first.

Panning for Overseas Investment

by Chris Mansfield · 0 comments

Wouldn’t it be great to see past the sales hype…

Because more often than not, a lot of marketing IS misleading…

but not actually in the way that you THINK it is.

What’s worse – some of those terribly designed brochures from ‘stranger companies’ can hide strong products!

Two of the safest, high return property investments that
made it through our tests had terrible looking marketing.

Whilst glossy, official looking marketing with big names &
logos you recognise often feels safer than it is and can be
the worst, sometimes even an outright property scam.

Very often, the safer it feels – the riskier it is!

Why?

Because the companies who have big marketing spends and
pay high commissions are often selling the worst products
for investors.

It makes sense doesn’t it?

If I’m a developer and I pay £10,000 for a plot of land
that will make a good investment when sold on at £15,000
to an investor, but it costs me £5,000 to advertise and
pay commissions to an agent to sell it then I need to
charge £20,000.

At that price it’s probably no longer a ‘good’ investment.

How do you tell the difference?

1. After reading a page are you left with more questions?

It’s easy to say what an investment actually is so if this
isn’t apparant from the first things you see they are probably
trying to obstruct and confuse.

It’s psychological trickery to force people to fall further
into the rabbit hole.

2. Is it meaningful detail?

If you are buying a car then the brochure will talk
about the engine, the model versions, etc. I have read
a lot of marketing where it says things that sound good
but mean nothing. eg:

Our engines are incredibly powerful, they always deliver
outstanding performance and are therefore the choice
that’s right for you.

The above sentence has said very little to me but at the
end suggested that the engine was right for me.

This is how it should sound:

This supercharged 5.2 litre engine delivers a whopping
600bhp.

It’s specific detail that does the talking on it’s own,
there’s no need for suggestions.

That is  of course, assuming it’s factually correct which
I’ll show you how to check further down the line.

It seems obvious, but there are so many credible looking
brochures for products that sell many units and yet the
accompanying literature is nothing but vague ‘sell the
dream’ waffle.

3. Did the content match your expectations from the
headline?

I’m looking at a classic example of an official looking
website that is actually quite dangerous.

In my attempt to establish what I might expect in return for
my investment, I optimistically visit the page entitled
‘The Returns’ only to find three paragraphs
of utter waffle which provides me with no information
whatsoever.

4. Do the investment examples match what the
content led you to expect?

For example:

The content might suggest that you will be purchasing a
below value property to benefit from its long term
capital growth but the investment example illustrates that
you are simply lending the developer money so that they may
benefit by sharing the profits derived from your loan.

5. Can you easily identify:

  • The people behind the company
  • Where they are located
  • How to contact them
  • How long they’ve been in business for?

Would you buy from a person wearing a mask?

Just remember: It’s all about transparency ;) .

6. Logos: An insight

Every marketer out there knows that people trust
companies they recognise.

If they are a complete unknown company, the
easiest thing to do is to put a few recognised logos
on their website or brochures.

If the images are fuzzy on the website, it probably
means they were pulled off the web which isn’t good.

Does it actually state that they work in
partnership with that company?

I have seen websites where the companies
have listed a variety of well known government
bodies and associations and what they do.

Often they don’t state an association, because they
know simply having the logo is enough to suggest
their company was bigger/safer then it is.

A number of people would have fallen for that.

Even when there are solid associations and relevant
logos they can mean very little in reality.

The bottom line is, some companies like putting
logos up to make you feel safe, but logos
in isolaton should never make you feel safe

about buying an overseas property investment.

7. Are the projections able to give you
specific realistic returns?

If yes, is it just examples of previous success?

Clearly, seeing big numbers for past performance
is an ok indication, but only if they are in context
(Figure spinning is more complicated but more on
that in a future dedicated post).

Past performance cannot be used as an indication
of future returns in regulated markets for good reason.

Lack of figures entirely is an indication of
leading you in but conversely outlandish statements
with unfounded or unsubstantiated guarantees are also
to be treated with suspicion.

So, in summary…

this is just the beginning of a long journey through
a very complex subject, but it should start to give
you a good idea of what to look for and what to avoid
when sifting through marketing.

Most people work with their gut instinct and generally
discard things very quickly anyways, but they are often
persuaded by clever marketing and worse still have
overlooked some potential gems that have made a lot of
people, including ourselves, some very good money.

If anyone has any questions, please do not hesitate to
comment below, I would love to create an open
conversation on this subject.

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