The number of property spruikers preying on SMSF trustees and practitioners has increased in the past year, with spruikers attempting to entice advisers with large commissions, according to one SMSF advice firm.
GEM Capital adviser Mark Draper says there’s been a huge increase in the number of property spruikers approaching his practice in the last 12 months.
About three different property spruikers will contact the firm every week in an attempt to flog property to their clients.
“They’re offering 5 to 10 per cent commissions, which should be ringing alarm bells [to any adviser],” Mr Draper said.
The increase in property spruiker activity is likely driven by the growth in property values, low interest rates and the growing amount of money sitting in SMSFs, he said.
“They’re seeing that as an opportunity. There’s a lot of money out there looking for a home and these guys are out there trying to get [that money] so [practitioners] and trustees need to be careful of that.
“I just think there are few more warning signs at the moment … in the property sector – that’s where I’m seeing the most risk.”
Mr Draper added that there has also been an increase in the number of risky unlisted property trusts with high gearing being promoted.
The increasing risk of property spruikers has also been identified by PI insurers, with insurers scrutinising financial planning firms providing direct property advice.
“I think the PI insurers are ahead of the curb. They’re seeing where the hot spots are,” he said.
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 22 Sep 2017ASIC permanently bans SMSF property spruikerBy Miranda Brownlee
- 22 Sep 2017Male SMSF investors ‘bigger risk takers’, says reportBy Staff Reporter
- 22 Sep 2017Lawyer flags subdivision trap with downsizer contributionsBy Miranda Brownlee
- 22 Sep 2017ATO urged to address ‘unknowns’ with LRBA reportingBy Miranda Brownlee
- 21 Sep 2017Lost and unclaimed super climbs to $18 billionBy Lara Bullock
- 21 Sep 2017ATO to release further guidance on reservesBy Miranda Brownlee
- view all
- Male SMSF investors ‘bigger risk takers’, says report
Male SMSF members tend to hold a greater share of assets in higher risk investments including domestic shares and property in comparison to ...read more
- Lawyer flags subdivision trap with downsizer contributions
SMSF trustees planning to make downsizer contributions have been warned that if a property has been subject to a partial sale in the 10 yea...read more
- ATO urged to address ‘unknowns’ with LRBA reporting
The ATO has been asked to provide further clarity around the events based reporting requirements for LRBA repayments, with the new requireme...read more
- view all