Wednesday, September 27, 2006

Florida property scams

I spent about an hour on Saturday browsing around the International Property Show being held at London’s Excel exhibition centre. These types of show have become very common in the past few years but it was my first visit to one and it was certainly an eye-opener. There must have been 400 or 500 stands all appearing to sell much the same sort of thing — holiday apartments and houses — at a bewildering choice of worldwide locations. The places you might expect were much in evidence: Florida, Spain, Portugal, Dubai, plus a smattering of East European developments with Bulgaria very much to the fore.

But these shows aren’t just shop windows for overseas estate agents. What it’s all about is property speculation. Putting deposits down, buying off plan, and then either selling on for a quick turn or holding on for holiday lets. Most of the visitors have, I understand, already done one or two deals and they are there hunting out the best returns for new investments.

I sort of ambled about looking at various stands, trying to avoid direct eye contact with the many pretty girls employed to pull the punters into a dialogue with the sales teams. Then I got trapped by an earnest young Englishmen who wanted to tell me about his flip scheme. No, I’d never heard the term, either.

Apparently, it’s a guaranteed method of turning $20k into $29k. Sounds good. What I have to do is put a deposit down on an as-yet-unbuilt 3 bedroomed bungalow in Port Charlotte in Florida. The finished bungalows have been “appraised” at $364k and will be bought at this price when completed. If the market won’t bear it, the developer will, via something called a Guaranteed Buy Back Guarantee. That’s two guarantees for the price of one! They are currently offering the bungalows at just $335k, and you only need to put down a deposit of $20k to secure one: you don’t even need to pay any interest on the mortgage you take out because that appears to be rolled up into the price by the developer. You pocket the difference, $29k, when the deal is completed. You don’t even need to go to Florida.

“It sounds too good to be true,” I commented to him, trying to sound just a little bit sceptical.

“I guarantee you that it works,” he said, without any hint of irony.

“But I have just been reading that the Florida property market is in freefall.”

“Oh, the media loves to scare people, doesn’t it? It’s really only falling in one of two over-blown hot spots where development has run out of control. I can assure you that Florida as a whole remains the fastest growing property market in the world. And this site is really well positioned. We do an incredible amount of research before we select the right properties for our schemes.”

“Well I wouldn’t invest without at least visiting the site.”

“No need to do that,” he said. “We’ve undertaken all the necessary due diligence already.”

At this point, I think he saw me sucking my teeth and decided I was not really much of a sales catch and so the conversation sort of petered out. I went away clutching his distinctly unglossy handout.

But it set me thinking. Lots of people obviously do go for all this stuff, otherwise this show wouldn’t have been taking place. And I have no doubt that, if the market keeps rising, they may even make some money out of these schemes.

But Florida isn’t a rising market. And why do they need to guarantee a guarantee? Maybe this sort of thing is for you but it’s definitely not my cup of tea. Take a peek at their website, see if you can make sense of it…


Anonymous Anonymous said...

beware of MRI overseas property , worked out scam, and stole 2000 euro from me, many still dont know they have been riped off.
MRI overseas property are headquarterd in spain, and this is how the scam works:
via their sky tv chanal,magazine, broucher,they find victims attracted to property investments, off plan or resale, they then say off plan is best and offer to show it over a weekend,(reason for this, so you cant contact bank or legal services)they show you somethings and say it is all their developments,but cant back any claim and get very nasty when you ask questions,they put you in a 5 star hotel,want your credit card details even though they say hotel is paid by them, they are very detailed and they wont be discoverd for sometime yet.
they use names such as SOUTH PACIFIC in romania and its a non registerd rubish who claim to be developers, cut a long scam short you end up paying for a diagram to a lawyer firm called LEGAL FACTORY, owned by SOUTH PACIFIC,and MRI has nothing to do with anything, at least not on paper.
they have operations internationaly and are steeling a lot of money.

3:36 am  
Blogger matt said...

be warned of a scam by an orgenisation called
they are operated by a well coordinated organisation and offer to sell you properties that has no value ,does not exist,or is well over priced,


3:43 am  
Anonymous Anonymous said...

Please Please DO NOT TOUCH MRI OVERSEAS PROPERTY WITH A BARGE POLE. They are nothing but con merchants and we lost around £3,500to them. They told us that Aspen Valley in Bulgaria had planning permission,when in fact it did not. They had a solicitor there who was supposed to be 'independant' and acting for us, and she told us that everything was fine and so we put our deposit of 3000 euros down. We had to pay an extortionate 50 euro fee bank charge subsequently just to send over a further fee to the solicitor (the bank charge should have been 10 euros). They put horrendous pressure on throughout, hassling you and phoning up to 6 times a day. We then got an english solicitor because we were not happy with them, who found out about the planning permission. They still wanted their next 35,000 euros stage payment, saying they would soon get permission.They were not open to negotiation whatsoever, and would not let us put the money into an escrow account until they had planning permission. Our solicitor strongly advised us to pull out of the deal as they could have had our money for up to 18 months, with no guarantee of an apartment at the end. Throughout the whole process, the staff at MRI consistently told us bare faced lies, and afterwards, when we had lost our money which represented a lifetime of hard work, they just laughed in our faces, putting the phone down on us. It was obvious that they must have ripped off other people at the same development, as all of a sudden there were several different apartments that kept suddenly 'becoming available' due to people pulling out for 'personal reasons' according to their sales manager, John O'Donoghue.
The english salesman, Lee Cousins, who we thought we could trust, had told us several complete lies when showing us the property in the first place.
The owner of MRI, Darragh McAnthony even has his own website in which he boasts of being a millionaire from property, but how can he sleep at night when the money is taken from people such as us who have worked and saved hard all our lives for the dream of a home abroad, which we have now lost as we cannot afford to replace the money we lost.

2:50 pm  
Anonymous Anonymous said...

Couldn't agree more, sorry to say it. MRI OVERSEAS PROPERTY are a bunch of professional salesmen/women, to be compared to timeshare/second hand car salesmen i.e. sellsellsell at any expense. They're based in Marbella for Christ's sake, doesn't that say something. They pick random figures for capital growth, irrespective of market conditions and add as much mindblowingly amazing information (based on possibilities/bullshit) necessary to sell the apartments, with little conscience for future downturns or problems. They obviously pay the lawyers (independent lawyers ha ha don't make me laugh) well because all bad feedback/complaints on the internet disappear or are retracted promptly- as seen with apologies often enough. Don't go near them, or just go try it out at one of their property expos in the uk and believe everything the untrained, brainwashed professional salesmen/women are force-fed.... first hand experience let's say.

2:00 am  
Anonymous Anonymous said...

I have just agreed to go to Cyprus and view their new resort in Paphos.
I have just checked my credit card statement and they have taken double the amount they originally quoted me for the flight. I was told the trip would cost £99 each but we have to pay for the flights and accomodation then they will reimburse us the difference that is over the £99, she said that they do it this way as people let them down, don't turn up. Is this what happened to you and if so did you get your sterling cheque from them for the amount over £99 ?

9:12 pm  
Blogger Unknown said...

We bought thro MRI over a year and a half ago.
Paid 2 year After Sales Sub and got absolutely no help from this.

We have insisted that all communications from MRI be by e-mail, not telephone. As a result we have a massive volume of contradictory, unresloved, and blatantly-wrong-info e-mails in hard copy! We are still trying to get our purchase finalised. The solicitor is as bad as MRI. The furniture we paid for eighteen months ago is still not installed and MRI refuse to refund our money. Any one help?

Elderly Retired Couple.

4:27 pm  
Anonymous Anonymous said...

Well, Dear Ones. Its like this. If you take out your Credit Cards to pay for property abroad without going out to inspect it, then its a case of 'Tough'. Our 'Union of Scam-artists' and 'Franchised ConMen' are looking for soft addled-pated folks to scam.

To its a case of 'Buyer beware!'

Gollum Brown Inc

7:00 pm  
Blogger Sam said...

Scams are all around the internet, especially those who are selling real estates so we must all beware.

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Anonymous Al said...

Property scams don't just happen in Florida. I was aware of this fact as I searched for prime Manila real estate. Thankfully my search turned out to be fruitful and scam-free.

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