How to Spot a Spruiker!

Salesman or showman? Be wary of the “property advisor” sitting across from you and ask yourself if he really has your vested interests at heart or is he simply trying to drag a deal across the line? In the latest edition of Smart Property Investment Magazine, the cover story features David Johnston, founding director of PPA who lists nine “must ask” questions to put to any property professional in addition to your own due diligence.


It’s important to do your own due diligence on the property professionals you’re considering employing, but it’s also worth asking them some questions directly.

Property Planning Australia’s David Johnston says property investors should ask the following questions to their expert property team, and know the answers they’re seeking.

Questions to “Ask The Experts”

Do you sell property?
People who sell property and unscrupulous operators within the industry aren’t one and the same, but Mr Johnston says it’s worth keeping in mind that those selling property have a vested interest, so you need to closely scrutinise the information they give you. There is nothing wrong with someone who develops or sells property, but investors need to make sure they know exactly what their property professional is offering: is it advice, or is it property?

Do you analyse property for a living?
“There are not many people who are great at something when it’s not their primary focus in life,” says Mr Johnston. If someone is offering you property market analysis or predictions, investors should make sure it’s their main focus.

Are you independent?
“People can undertake significant research and still find it hard to differentiate between what is fact and what is fiction,” says Mr Johnston. What is your experience? How long have they been a professional in the industry? How long have they been at their current company? What was their history prior to that? Are they an investor themselves? “A lot of the shonks, or the spruikers, are just salespeople. Finding out their experience can often provide a good background on the person and help you get an understanding of who you’re listening to,” says Mr Johnston.

Do you earn income anywhere else?
Property professionals need to earn an income, but they need to disclose to their clients where the money comes from. Even though any commission structure or kickbacks should be disclosed up front, “investors just really need to ask”, says Mr Johnston. “If you have a smooth salesperson talking around the edges, they’ll only give you half answers.”

What sets you apart?
Every business should be able to effectively tell you what they offer, how it will help you and how it differs from other alternatives in the marketplace.

Questions to ask Yourself

Are they only selling one strategy?
Can this property professional offer you a tailor-made solution to your personal circumstances? Or are they just selling one type of property, one idea?
“A good business will understand you, your goals, your aims, your financial position – and then help you develop a strategy back the other way, based on
your circumstances,” says Mr Johnston.

Do they genuinely discuss my financial circumstances, longterm plans and risk management?
“People who are genuinely trying to help you will want to know about your circumstances and they’re actually going to want to help you understand the risks you’re potentially taking,” says Mr Johnston. “A good investment adviser will help people manage their risk as much as anything. If they’re not talking to you about risks, they’re probably trying to sell something.”

Do they jump straight to the purchase stage?
“Property is sexy. Property is emotional,” says Mr Johnston. “So a lot of people, when it comes to buying property, will automatically jump to the selection of the property itself.” Instead, the actual property should come after you and your adviser have an understanding of your financial situation.

Read the full article here as featured in Smart Property Investment Magazine (December 2013 edition) with contribution from David Johnston, founding director of Property Planning Australia (PPA) and co-author of Property For Life – Using Property To Plan Your Financial Future. Property Planning Australia was established in 2004 and is a multi-award winning property, finance and financial planning consultancy that provides its clients with a holistic approach to financial and investment advice.

The PPA team specialise in developing holistic property strategies for first home buyers, investors, upgraders and those transitioning into retirement. To find out how PPA can help you make the right property decision today for your tomorrow, contact us.

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