Irish Land Deals - Scam?

L

Lemurz

Guest
I'm curious if anybody else received the following unsolicited e-mail this week? Anybody ever heard of this before?

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We have an exciting new investment concept that may be of interest to you.

If you are looking to create capital over the next 6 months then this could be the right deal for you.

I have attached an outline of how the deals work, however, if you need further information or a sample contract sending to you please call.

Land Price 100,000
Build Cost 150,000
Total Cost 250,000
Sale Price 450,000
Profit 200,000
Land Owner 50% 100,000
Our Profit 100,000
Client 50% share 50,000
RATE OF RETURN
Client Investment 17,000
Client Return over 4 build stage payments 50,000
Rate of Return 295%

We source a buyer for the property, the buyer puts down a 20% deposit and secures an 80% build mortgage
The mortgage is paid in 4 stage payments over the build period

The investment client receives their share of these payments, normally over a 25 week period, depending on build progress and weather

This means the client receives approx 12,500 euro on the first stage payment which leaves them just 4,500 euro short of their original investment

By the second stage payment the client is in profit

Title edited by ClubMan.
 
More info..........

In summary, this is how the deals work:- the investor invests £11,500 into
a build project, we have already sourced end buyers for these sites. The end
buyer organises a build mortgage which drops down over 4 stages once the
foundations are finished. The investors money gets the build under way and
finished to foundation level. Sites are individual plots in Donegal,
Ireland. There is a significant tax advantage to the land owner in the way
these deals are structured, hence the investor gets a 50% share of the
profit this is in return for the fact that their investment gets the build
started and this structure creates a tax saving for the land owner. For the
original £11,500 you get £34,000 back over 6 months in 4 stage payments.
Many clients do multiple investments on this but you can do single
investments if you prefer. Its a high return capital raising investment in a
short space of time. There are only 5 sites left on this investment.
I have attached an example of the contract which will give you a good idea
of how it works.
Please contact me if you have any questions.
 
My first question is what guarantee/security do you have on your investment?
 
Sale Price 450,000
Profit 200,000

Presumably these are illustrative an not necessarily guaranteed since the market will dictate the ultimate selling price?
 
"Sale Price 450,000"

It must be some house if it's selling for that amount of money in Donegal - you'd get a 4 bed semi d in a nice area for that in Dublin

If it's such a good deal why do they need private investors anyway ?

I would look to get the exact location of the sites and see if they have got planning permission to build.

It sounds a bit like the English Land deal that was discussed a couple of times on AAM

efm
 
Who is promoting this deal? I have heard of somewhat similar investment schemes before, but they were high risk for people with plenty of cash who could afford to take a risk!
 
This is the signature on the e-mail.....

Annmarie Blomfield
Property IQ
 
Not saying that I'm an expert but I do have a little experience in this issue, so comments below are guarded:


Land Price 100,000 - typically a house that would sell for 450k would not be on a site costing 100k (and that doesn't seem to include stamp duty / levies / services etc. etc)

Build Cost 150,000 - if you want to achieve a big price in a rural setting the house would have to be relatively large ie. 2500-3000 sq ft @ say a minimum of €100 per sq ft that's more like 300k to build

Total Cost 250,000 (see above, this 250k in bullsh1t!)
Sale Price 450,000
Profit 200,000 (as above)
 
There are very few houses in Donegal selling at €450k. They are there but they are not moving for less money even. Very few sites in Donegal would cost €100k. As stated above, you will not build much of a house in Donegal for €150k. I know.

Slim 8)
 
If its unsolicited should that not be all you need to know?

Oh hang on, gotta run, that's Mr. Rothschild on the phone with an irresistible offer he thought I'd like a piece of...
 
Looks very fishy. And what's all that about significant tax advantage for the land owner to give away part of the profit to you, the trusty investor. Given that you only pay taxes on profits, there's never an advantage to give away profit.

You know what I'd do? Create an "anyonymous" email address in gmail or hotmail and reply to the scam just to see what happens. In fact, why don't you post the email reply address here and a few of us could "sound out" the proponents of this "deal."
 
I'll do that too.

I'll reply to the scam and lead them on too.
 
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