Your Super; funding rorts & Skyrocketing Property values

Nice to see the Federal government targeting foreign investment in property,but thats not the problem. Australian Equity Managers, Australian banks and so called financial geniuses (yes, the same ones the govt stopped going bankrupt,) are the primary driver of skyrocketing property prices -using your super funds. You thought your super fund was managed by geniuses? Think again!! Your super is ultimately pooled by about 5 laissez-faire capitalist businesses, who use equity fund managers to generate their (sorry,your) returns. So when you get your 12 to 15% return pa (in the good times) you smile. Have you considered what your money does to warrant the returns you get? Heres one example.Its called “The Agreement”.Its very “hush,hush” and played by a self appointed group of equity managers. The agreement has three known players – it may have more.

  1. The rules are simple.
  2. Buy a number of units in a development. Each manager buys in a different block.Ownership may be held in any of a number of companies or other created (but beneficially owned) entities. They usually get the lucrative property management rights “thrown in.”
  3. Hold properties for 5 years; Claim depreciation & other expenses.
  4. After 5 years,investor A sells to investor B,B to C and C to A – pre agreed price, calculated to guarantee windfall returns.

   This is just one method which is known to be used in the Metropolitan residential property market. Other methods have been described to us.

 Our understanding is that while previously it was the case that properties were left vacant, so they could be resold “new”, more recently, the properties have been placed on the rental market.Some examples known to us are leased by 1 tenant (he leased at least 6) which he crams with “overseas students”, in some cases paying for “bed time”, 8 hours per day.

 This is how your super funds earn the dividends they do. There is no magic formula.Just collusive rorts run by the same tight circle of self declared “financial geniuses” operating out of “Private equity” practices. This is how your super is making Sydney and other Australian locations unaffordable for your children.

 When combined with the #wageslavery legislative restrictions which prevent workers employing effective negotiation to protect their incomes, I’d be surprised if your children will afford to pay rent in Sydney – those who stay will be the next generation of homeless.

 What would be a starting point is to prioritise residential ownership, and heavily tax residential investment. There are plenty of other opportunities for the feeding frenzy of vultures who enjoy preying on people to fund their million dollar salaries – oh, you invest in residential property?? Get out of it.. before others just come and take it. Eventually, when people become sufficiently desperate, greed will get you killed.

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