It has been said that Independent (Non Institutional) Property Valuers are the eyes and ears of the real estate financial institution. With this in mind, here is one secret you may be interested in knowing… 

In recent years, property developers have started turning (as a moderate example) $500,000 into $10,000,000 over fifteen years? It starts with buying a block of land with a house for cash. Good ol’cash, cold hard cash, moola, the kind you hold in your hand, real money you may say. As we all may know, cash can have great negotiating power, because of the almost instant exchange of money to the vendor for their property. Some sellers under financial distress are prone to prefer a quicker sale, relinquishing their financial hardship and the added selling costs and longer lead times that come with a more traditional sale funnel. 

Once certification and ownership has been transferred to the property developer, the secret becomes more revealed… The property developer immediately commences with a pre-scheduled maintenance, repair and installation of intelligent designed features, all done at a minimal price, adding a greater property valuation. This is followed by a diligently organised house sale event, targeting buyers who can’t get financing easily. These buyers are predominantly sourced through accountants, solicitors and selected online platforms. 

Because the property developer is making it easy for the buyer, you can get more than the fair market value of the property. The buyer needs a lower down-payment/deposit and makes lower monthly payments  than regular banks expectation. This allows the property developer to charge a higher interest rate than the banks, of course!

This is a win-win situation. The buyer is able to buy a home instead of renting, and the property developer gets a capital gain PLUS good interest. 

It is anticipated after some given period of time that the buyer will begin to experience financial hardship requiring a default on a monthly payment and after three consecutive default payments, the home is foreclosed, allowing the property developer to re-take possession of the premises. The process begins again, minor maintenance, repairs and re-sale (at a now higher price from capital appreciation over time).

Property developers are making millions. On average, the return can be over 22% on their money, that means $500,000 into more than ten million dollars in about fifteen years.

That's the secret folks…