A lot of investors have lost a lot of money or been stuck/ unable to escape from 'those waves'. In order to avoid the tricks that can make you lose all the capital saved in many years, it is necessary to stay alert as well as analyze the situation thoroughly before making decisions on investment. Here below are some remarkable fake real estate “waves” to push up the prices that you need to notice!
1. Establish fake price benchmark
2. Create fake demand
3. Create fake scarcity
4. Herd campaign
5. Fake information
6. Fake official
7. Joint investment
8. Commitment to sublease at high profit rate
I / Set up a fake price benchmark
The rising price of an Iphone X or a Toyota Fortuner car in one store does not lead to the increase in price for all Iphone X or Toyota Fortuner; but unlike many other industry, the increasing price in a land lot or a house / an apartment in an area may lead to a new price benchmark for the whole area. Due to this characteristic of the real estate market, many brokers or sellers have launched games creating transactions to evaluate a few houses/ real estates and establish the price benchmark for the whole area. Then use the follow-up moves to get buyer on the 'ring'.
II / Create fake demand
Once the price benchmark has been established, broker or seller uses their network to create unreal demands. From the time you do not notice to the time you decide to spend time surveying the real estate, you are always netted in the mess of information about the demands and purchase transactions. It is super difficult to verify these kinds of information.
III / Create fake scarcity
When buyer tends to believe the information about price and demand told by the seller, seller will create scarcity information, for example: “there are only 2 lots or 2 houses left, but there are many people who want to make deposits. I just keep it for you because I like you, it will be sold tomorrow if you don’t decide now!”