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9 comments
Land Banking concept is a genuine concept, with potential to make money. But remember higher gain, higher risk. it also depends on whether the one operating it is genuinely wanting to operate the business properly. you want 100% no risk and few hundred percent gain. No such deal in the world.
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The rule with playing cards that if you can’t spot the sucker at the table then its you!
The same applies with land banking. They are making so much money that they can afford to give expensive free gifts, and use 5 star hotels for the sales presentations.
They are not making money from land obtaining planning permission. They are making the money from the sucker at the table which is you.
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think many people, eventually, who invested in landbanking, live to regret. many people also invested to buy a piece of the moon. Yes, the moon that revolve around our mother earth. They think they can laid claim to that too. (May be we should be selling them tickets to the moon too – make some quick bucks.)
What to do! It’s their money. no quarrel with that!
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Personally i think if the deal is so good, it will never reach me. If it reaches me, then must hv been thrown into the rubbish bin by so many people all the way from UK on down.
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This blog came so timely. I just received a cold call today from a land bank company trying to entice me to buy a piece of land by giving away a free iPad2. Look’s like this form of investment is becoming vogue again.
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Excellent post. Please see also this post from the UK Daily Telegraph.
UK FSA heads for showdown over illegal land bank sales
http://www.telegraph.co.uk/finance/financial-crime/8483845/FSA-heads-for-showdown-over-illegal-land-bank-sales.html
The City watchdog has launched legal proceedings against six firms it suspects of selling land to investors that would never be given planning permission or stand any chance of being developed.
The largest of the six cases the FSA is currently prosecuting is thought to be worth around £35m.
One problem for the FSA is the reluctance of investors to come forward. Many customers of land banking operations refuse to believe they have been subject of a scam even after they have been contacted by the FSA. Instead they prefer to cling to the idea their land could yet turn a profit.
Many of the operations target the old and vulnerable.
The sales techniques can include follow-up scams with investors being sold multiple plots or asked to pay additional sums in order to liquidate their holdings once they realise they will never turn a profit.
Mr Phelan said some of the plots being sold would not only stand little chance of gaining planning permission but were too small to build on.
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