Real Estate with its potential for profit has always been bait used by some con artists looking to capitalize on other's lust for too-good-to-be-true deals. Most of us have heard about the Florida swamp land scams or similar transactions of property oversold in varying degrees. Just one more good reason to rely on the knowledge and resources of professionals and to execute full due diligence in any transaction of real property. Here are some of the typical scams many have fallen for. 

Click to read more about common real estate scams

Another such critter to keep an eye out for isn't selling Terra firma per se, but instead, the promise of the inside edge, the secret formula to wealth through real estate. These shysters pass themselves off as Real Estate investment coaches and trainers, offering up seminars and programs heavily saturated with the promise of overnight rags to riches. Like carnival side shows they travel town to town selling outdated and unworkable theory from one sold out hotel convention room to the next drawing out the eager and vulnerable in each metropolitan area with local print ads in the weeks leading up. 

Don't get me wrong, there are quality programs and legitimate investment coaches and counselors out there with proven track records who will give you the strait poop on investment. Just as finding worthwhile property to invest in requires careful investigation and comparison, so too does finding a good mentor.

A favorite pitchman and a pioneer of the late night infomercial in the 80's and early 90's who spawned an industry of copycat hucksters was the self proclaimed guru of real estate investing Tom Vu. With a betamax camera, a few bikini clad bimbos and a half day rental of a 60 foot cabin cruiser and a Rolls Royce to create the illusion of the success he could also inspire in you, he put together a series of commercials that were so cheesy even by the day's standards you just had to watch. Tom Vu promised that you too could become stinking rich, just like him.  "Are you man enough to get off your lazy American ass and go to Vu’s seminars?" he would expound while leaning against a Rolls Royce parked in front of a mansion, who could resist? He made money alright, capitalizing on others lust for finding their golden goose. Tom had the last laugh but you can have a look and a laugh too watching some of his classic 1980's infomercials on youtube. Click here

At least a few times every year I hear from recent graduates of one rags to overnight riches program or another. They are easy to spot. Their portfolio is non existent...yet, but they are convinced they have been given the formula for wealth and have it down to a 4 or 5 point plan. They tell me with the newly acquired confidence and outlook of a lottery winner that they and their investment partners, other graduates from the same course they just took, are sure to be buying one or two properties a month from me. They want me to find them distressed properties. Typically power of sales, estate sales or homes caught up in divorce settlements.

The majority of these budding land barons that have come to me don't even qualify for financing and they typically vanish when I send them out to get pre approved for mortgage financing before we begin scouting the landscape for properties. Nothing in their training seminars prepares them for such scrutiny. 

Others will present themselves well right up to the moment we sit down to write up an offer after a long day of showing properties to them at which time they reveal they will be offering 50% or often times even less on a property at which time I offer them some legitimate bubble bursting advise to take home and think through. I have only ever heard back from a couple of them after that point.

The credo of  the get-rich-quick-from-real estate seminar is that if you present enough low ball offers eventually someone has to bite. The reality is:

• No Realtor is ever going to invest the hundreds of hours viewing homes then sacrifice their professional reputation and the time of industry piers to draw up then present and attempt to negotiate 50 to 100 unrealistic offers in the hopes of eventually getting just one deal through. Not on this planet anyways.

• No Home owner of medically sound mind is going to sign over their home to anyone for half or less of market value when other properties are selling for 95% or more of list price.

• Another myth perpetrated by some of these courses is that power of sale properties can be had often for a small fraction of market value when in actual fact there is an obligation of lenders in foreclosure situations to get a reasonable percentage of market value in these sales.

• Yet another myth is that you can easily get vendors to carry financing on your investment purchases. You just have to ask. You might even get in with nothing down this way! There was a time when interest rates were double digit that this was a possibility. A few people made out well selling their homes in the eighties and taking back mortgages that payed them ten thousand dollars or more a year. Today with interest rates at historical lows, the risk far out-ways the reward for taking back a mortgage and very few are willing to enter into such a contract with a total stranger.

• The buy today - flip tomorrow after a new coat of paint and a trip to the garden center makes for good reality tv but then reality tv is an oxymoron.

Not to despair. There are opportunities out there. In my market, undervalued properties and distressed properties come onto the market throughout the year.

The best advice I can give, better than anything you will pay to learn is to find a Realtor who can and will insure that you know of these opportunities not the same week or day they list but within the first hour of coming onto the market. Couple that with a favorable cost - benefit analysts and market stats and the negotiating skills of a seasoned local Realtor and you are on the high road to real estate success. 

There are also properties requiring some sweat equity to bring them to their full value potential. Knowing which properties have that potential and honestly assessing not just the best case, but the worst case scenarios of what improvements a property will require to give it that potential are key. 

Real Estate values in Ontario have proven to perform better and more securely than the stock market over time and owning a second, third or 4th property will likely continue to be a good investment for most.

• Do your research thoroughly
• Take advantage of the knowledge and resources of a good Realtor
• Visit HotBarrieListings.com to set up your instant notification pipeline and begin receiving listings with the highest investment potential to your email or smartphone.

One valued source for up to date and research backed investment information worth checking out is  R.E.I.N. Subscribe to my twitter and facebook links below as well - two good day to day sources for local real estate related information that will keep you in the know on Barrie and area real estate matters and remember, if it sounds too good to be true....well you know the rest.