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OTHER GUIDES & TIPS

Social Media property influencers blasted for dodgy claims

A quarter of TikTok influencer videos claiming to offer guidance or advice on property investment have been found to be misleading.

The Online Mortgage Advisor service analysed videos from TikTok influencers with a combined 11.8m followers and with an average reach each of some 500,000.

Some 64 per cent were not transparent about their qualifications in the property and investment sectors, and 99 per cent of the videos did not have any disclaimers for their audience.

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The research analysed 624 videos from 25 different top property influencers and flagged any content that contained suggestions to invest in or purchase property, comments on how much to spend on the property or where to buy it, and claims that purchasing property guarantees a profitable return.

Pete Mugleston, managing director of Online Mortgage Advisor, says: "Whether it’s your first home or an addition to your investment portfolio, buying a property is a huge financial decision that needs to be researched thoroughly beforehand. 

"Worryingly, our research revealed a considerably high proportion of videos giving property investment advice on TikTok, an app that’s most popular in the UK with those aged 18 to 34. 

“Of these videos, we flagged one in four as misleading, and the majority of their creators didn’t mention having any qualifications or professional experience in real estate – something you should certainly look for when taking financial advice."

Mugleston continues: “One of the most common types of content we found on TikTok’s #realestateinvesting corner – a hashtag with nearly 1.5 billion views - were influencers boasting about how much money they had made by investing in properties.

“One money-making strategy that influencers espoused was ‘house hacking’, the term for buying a multi-unit property and living in one unit while renting out another to pay the mortgage. While the promise of profits using this method can be enticing, the reality is that property investment will never be a guaranteed source of income."

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  • icon

    Fools and their money are easily parted ! If you’re dumb enough to take any important financial advice from social media then you deserve to lose it.

  • George Dawes

    From my experience social media is filled with arrogant idiots boasting about their lavish lifestyles while most of the time they’re living on credit cards and everything they supposedly own is actually rented or leased

    All top show not much else . Preening like retards into their iPhones sucking in their cheeks and looking like androgynous freaks of nature

    Uncle klaus would love em

  • Vanessa Warwick

    Thank you to the company who undertook this research.

    It's so vital to highlight the unregulated nature of property training and the "advice" that property trainers give.

    It can often lead to the person being in a worse financial situation than when they started out in the training.

    I am particularly concerned when property trainers claim that you need little or no money to get involved in property investment.

    It's extremely misleading.

    Property is an expensive asset to purchase, maintain, and also keep compliant for a tenant's safety.

    If you use "control" strategies like Rent to Rent and Lease Options - much of the same applies.

    Let's work the numbers. You purchase a course for £12K and you end up getting a Rent to Rent property that delivers £300.00 per month net cash flow.

    At that rate, it would take you over 3 years just to get your £12K back and be in the same financial position that you started out!

    Many property trainers make huge claims about their wealth and success, and the kind of returns that can be made from their property strategies, which often cannot be verified. Even the most basic due diligence - like putting their name into google - would help people find their way to resources that would help them decide if the trainer was legitimate.

    The trouble is that these social media platforms are generally frequented by young, vulnerable, and naive people who don't know how to do due diligence and also take everything at face value - many being desperate to improve their lot in life.

    They do not stand a chance against the seductive, alluring, and sophisticated marketing techniques used by these trainers.

    Every week I am contacted by distraught people who realise they've been "had" and are in a worse financial position than before they met the trainer.

    As the sector is unregulated, there are very few routes of redress to get your money back.

    If you must pay for training, put it on a credit card, as you are then protected by Section 75 of the Consumer Credit Act and may be able to get a refund via your bank.

    If you are a victim of a property trainer, feel free to get in touch with me. I will always do what I can to assist.

    But, as with everything in life, prevention is better than cure.

    Don't fall for promises of easy riches in property with little or no money. You'll be buying what amounts to be a ticket to see a Unicorn.

  • Vanessa Warwick

    Some of you may be aware, that, for my stance of calling out false claims, I am now being sued in the High Court by a well-known property trainer who was subject of a BBC undercover investigation in 2020.

    I have asked the public to assist with my legal bills by starting a CrowdJustice funding page.

    Unfortunately, I cannot post links but if you write to me at vanessawarwick (at) icloud (dot) com , I will send you the link so that you can make a donation.

    Thank you to anyone who can support me in my legal fight.

  • icon

    Get rich quick schemes don't work, hard work however always pays in the long run

  • icon

    It is not only the property industry. I am a keen aviation enthusiast and tictoc is full of inaccurate and dangerous advise. No doubt it is the same in all fields.

  • icon

    Sadly, younger people (most often they are) see the 'wealth' of some of these social media influencers and decide they want the same. BUT they don't want to work for it! No one gets rich without a years of work and commitment, often 20 hour days, no holidays, no fancy lifestyle for many years. I know one wealthy person who slept in the guard hut at his warehouse for years before he became successful. I would never want to make that kind of commitment - that's why I'm not wealthy, well not financially wealthy anyway :)

  • Philip Drake

    Law makers and voters also see these claims and their perceptions lead to clamp downs on the sectors. Thus impacting on other realistic participants in the sector.

    Could this have been a contributing factor for the Section 24 tax change?

  • icon

    It has oft been the case that the real money is being made by the trainers. As I read on a post recently "if you made so much money with your strategy, why are you pimping yourself on FB to sell books or courses?". It's a bit like a modern pyramid scheme where more money is made on selling the starter pack to new recruits than is made selling the actual products!

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