Get advice on debt, FMA warns property buyers

The Financial Markets Authority warned yesterday that people with little or no income were being targeted to attend property seminars.

It named newspaper ads by Property Tutors inviting people with the promise that they will learn systems to get loans to fund investment in property.

Sean Hughes, chief executive, said investors needed to understand the costs of property ownership and debt servicing, market fluctuations, and the risk of losing assets used as security. He encouraged anyone thinking about taking on debt for investment purposes to get independent legal and financial advice from a registered or authorised financial adviser.

Steve Starke of Property Tutors said the sole owner and director of the business, Sean Wood, would be the only one responding to questions about the matter.

Wood claims to have built a $15 million property fortune in 3 years.

Steve Goodey, based in Wellington, did not know about the warning and was surprised. He speaks at Property Tutors seminars and said an all-day event was being held tomorrow at the Rendezvous Hotel in Auckland.

Goodey said he had "several thousand clients with total property interests of many hundreds of millions of dollars".