This month our roving reporter eats a dessert messily, finds he’s rather gone off girls and is threatened with being thrown out by security.

Kingsley Amis said that when he got to his seventies his interest in sex started to wane.   Once this had happened, he realised he’d spent his whole life ‘chained to an idiot’.  I have to agree.  These days, when I go round shows and exhibitions I no longer find my eye caught by the pretty girls handing out flyers for over-priced this and soon-to-collapse that.  In fact, I find I don’t spend very much time on the stands at all.  Don’t get me wrong, a lot of the stands are very good firms selling services and properties that would make a sensible choice for many investors.  But the ones I’ve not seen before are often young upstarts and the ones I’m familiar with, I already know – often inside out.

So instead, I use the shows as a great place to network – catching up with some old faces and asking why some of the absent friends have vanished.  It won’t surprise you to find that over the years many of the people I’ve known have met a sticky end, so to speak.  I’d expect that process to quicken as the economic storms loom and the weak get blown overboard – but more on that later.

First, I thought I’d just let you all know about an amusing little incident that happened at the show – the latest episode in a small saga that I’m having with Ranjan Bhattacharya, a well-known speaker on the investment and show circuit.  I’ve been reviewing property courses for years, and the deal is pretty simple.  I go on the course for free, and they get a review in the magazine.  In all the years I’ve been doing this, the policy has never been an issue for anyone whose course I’ve reviewed – except Ranjan.  Before meeting him, I had great faith in the personal integrity of trainers, and paid for the course out of my own pocket, on the assurance that I’d get the money back when the review was published.  I duly reviewed the course, took Ranjan’s feedback on what I’d written and then it went to print.  All fine, you might think.  Sadly not so!  I asked Ranjan for the course fee back, and he refused, saying that he’d not ‘approved’ the final text, despite the fact I’d edited it in the light of his comments and then emailed it over to him for further checking before it went to press.  It winds me up badly when I think I’m being ripped off, and so I instructed my solicitors to write to Ranjan, demanding he refund the course fee.  He collared me at a subsequent networking event, and we agreed that he’d donate the money to charity instead of giving it to me.  Case closed, you might think.  Apparently, it’s not that simple!  Having experienced Ranjan’s reluctance to pay out once, I thought it best to check if he’d actually paid the charity donation he promised.  I then emailed him and I don’t recall having received a response confirming he’s given the money.  As I was passing his stand at the show, I wandered over and asked him if he’d paid up.  He refused to answer and threatened to call security! I thought this was quite an amazing way of carrying on over a charity donation.  I can only assume he’s not paid up, so it looks like I’ll have to instruct solicitors after all.  I think it’s a pretty poor show if someone who runs a big training company can’t pay a few hundred notes to charity when they’ve agreed to do so.  It probably won’t surprise you to hear that since doing Ranjan’s seminar, I’ve not been bowled over by people rushing to say good things about his personal integrity!  As Robert Kiyosaki says: the problem with getting rich by being cheap is that even when you’re rich you’re still cheap.  Whilst we’re on the subject of successful training companies, the problem with a lot of them is that they’re run by people who used to follow the business model they’re espousing, but now just rake in money training people.  The trouble with this is their knowledge often becomes rusty and out of date.  I don’t know if this applies in Ranjan’s case, but I’ve not heard anything recently that re-assures me that the busy seminars he speaks to are actually based on a busy property firm.  When you’re choosing a training course, I’d strongly recommend you do your research on the trainer.  Are they someone you’re comfortable doing business with in the long run?  Are they an industry professional, or just a has-been who’s turned to training for easy cash?  Many courses are the start of a long running business relationship, so choose wisely.  Caveat emptor applies to all business transactions, not just to the purchase of property.

The main draw for me of investment shows is the seminars and panel debates.  The quality of the free and almost free seminars at the Homebuyer show is consistently better than the content of most paid-for training courses.  It has to be, because speakers only have 45 mins to convince you they’re worth doing business with.  Furthermore, the fact that so many people are in one place at one time gives the opportunity for you to hear a range of views.  In the same way that many would argue that no one religion holds a complete and accurate view of god, it’s fair to say that no one investment firm or speaker can ever hope to hold all the information an investor might need.  Only by putting yourself in front of a wide range of experts can you hope to appreciate the breadth of views you need to keep on top of the developments in the market.

One feature that really caught my eye was a lecture on the US housing market.  Sadly, I can’t tell you who was holding it, because the billing for this particular session was wrong. I shan’t bore you with a load of sub-prime drivel here, but suffice to say the world has fallen to pieces recently because a load of stupid bankers in America thought it would be a clever idea to buy a bunch of mortgages taken out by jobless oiks who were never going to pay them back.  So far, the resulting shambles has put paid to Northern Rock and Bear Stearns.  Doubtless a lot of others are soon to follow in due course as the skeletons fall out of banks’ closets one by one.  There are a few questions that remain of course.  Is the US going into recession?  Is the US housing market through the worst of it?  Will the damage spread around the World, or is it going to be largely limited to the US?  This seminar was run by a firm selling US property, so unsurprisingly they were bullish.  However, what was surprising was that their arguments were actually quite sound.  The view they were taking was that the US economy is still growing fairly strongly, if you take the current year-on-year figures.  After a big fire sale of stock, inventories are trending down, and as supply of new homes starts to fall, prices are likely to rise – especially as the US has the same demographic issues of changing family size, continuing immigration and increased life expectancy that is driving demand in the UK and many other developed societies.  They trend, they argue, is up.  I, on the other hand, would argue that despite my brief flicker of optimism on seeing this data, they dung has yet to enter the fan.  The growth rate may be positive, but it’s a lagging indicator.  Employment is also a lagging indicator, although one much loved by market bulls, who fail to recognise that it doesn’t fall until well after the party’s over.  After all, you don’t sack someone unless you really have to, do you?  If only someone would point this fact out to the rest of the commentators in the property industry, especially those on the panel debate who should know better…  In my view, the US economy hasn’t yet fallen over the waterfall.  The boat has tilted over the edge, but there’s so much worst to come.  Even the employment number from the US are now falling over the edge.  Grapes of wrath, anyone?

The best bit of all is the panel debate.  It’s a struggle to get into a sensible and focussed conversation with only one expert, but the opportunity to have them all lined up like coconuts at a fairground ready to be knocked down with difficult questions is an opportunity not to be missed.  The only slight downside of the panel was that it was filled with a completely uniform selection of middle aged white men.  It seems the glass ceiling is still operating perfectly in the investment services industry, despite the meritocratic nature of the landlord community.  I’d actually done my homework for once, and I was all fired up and ready to challenge them with tough questions.  This time, the UK panel (there was an international one too) was occupied with the thorny issue of where the UK market is headed over the next 12 months.  There’s a fairly traditional rule of thumb that I use in property investment – if you disagree with John Wriglesworth from Hometrack, you’re wrong.  I broke this golden rule in the debate.  He, and just about everyone else, was trying to argue that the UK market was hitting a minor wobble and then was going to recover.  The only exception was the rather bearish Neil Lewis.  For reasons that may or may not be related to his business flogging predominantly Central and Eastern European property, he was bearish on the UK market.  I topped them all.  I’m the ultra-bear at the moment.  The biggest, grizzliest, most sore-headed bear of them all.  I just can’t see how you can drag the market through what’s described as the worst economic crisis since World War II, and expect it to come out without taking a slapping on the way.  It’s not going to happen in my opinion.  The time has come to batten down the hatches, invest in low risk, no-frills, high-income properties, forget equity growth and wait for the storm to pass.  Maybe I’m wrong and all the six wise monkeys of this panel were right.  But maybe they’re not.  And if the sky falls in, are you going to get hit by it?

I best be nice to Neil Lewis and Property Secrets, because I got a free dinner out of them at their investor evening.  Now, in the noble tradition of UK journalism, I am pleased to reassure that I am completely above undue influence.  I do, however, think that Property Secrets is the best investment company in the World, based on the quality of their desserts – although an inexplicable dearth of cutlery made them impossible to eat tidily.  I might not agree with all of their analysis, but they certainly make a good case.  Their conjecture is that the markets they look to invest their clients money in are based on low-cost economies.  Even in tough times, the heavy manufacturing money is going to keep flowing into Eastern Europe, as the furniture and tractor makers need to cut their costs and keep heading out east.  I think they’ve got a good point, and one that I hadn’t considered.  Technically, their argument is that a recession in the US or UK won’t get exported to the CEE economies, as their low-cost advantages will make them appealing destinations for cost-conscious heavy industry in hard times.  These manufacturers need to cut costs harder in recessions, as they’re operating in a more price-competitive environment and their overheads are forced down by falling sales.  Property Secrets’ conjecture is that this effect is going to be enough to float the property market.  Personally, I just don’t buy it.  I think that effect is significant, but it’s not going to keep the property market afloat if the world economy is drinking white lightening cider out of a carrier bag on skid row.  By all means, chase the low cost, high-growth economies if you want to see some smart growth on your money.  But don’t think for a second that the hurricane sweeping through the financial markets is going to leave your posh new flat with a luxury kitchen unscathed as it sits pretty on the top of the market.  If your yield isn’t enough to make the investment wash its face, will an aspirational local yuppie have the cash to not only pay for your pad, but give you a fat wodge of profit at the same time?  Will a UK investor be willing to play for the long haul when he can’t draw down equity on his house because real interest rates are sky high and the bank’s taken away his easy remortgage credit line in a huff?  I don’t think so….  Ladies and gentlemen, I dearly hope I’m wrong.  But those who prepare for crashes that don’t come are generally happier people than those who fail to prepare for crashes that do come.  On second thoughts though, the sushi was wicked, so European flats will probably be OK this year.  Seriously, I’m not trying to dis the CEE or Property Secrets.  Their reports are good quality and their investment philosophy is at least justifiable.  I’d just recommend that investors heading for CEE go for the brown corduroy trousers properties that make acceptable yields and aren’t based on super-dooper fandaby-dozy growth in possibly shaky markets. Either way, for the most part I reckon they’re probably a lot safer than investors who stay in the UK over the next year or so, particularly if the UK chaps try to by the same new-build flats over here that are all the rage in central and eastern Europe.

The show was especially interesting for me, because I got my first official speaking slot.  I’ve been strong armed into doing this by the organisers, who were keen to have some ‘real’ property investors speaking in the seminar programme.  True to type, I decided to take the mick, with a talk entitled ‘How to lose a million pounds in property investment.’  For those familiar with my monthly column here, it was lots more of the same – mildly humorous personal anecdote designed to sweeten a fairly stiff dose of property medicine on the way down.  I’m in the fortunate position of not having to convince everyone that I’m infallible, and thus I’m one of the few people in the property industry who can actually admit to being human.  My paperwork is only saved from total collapse by my long-suffering staff, I’ve bought plenty of places I’ve bitterly regretted over the years and I’ve taken a proper kicking from a combination of rising interest rates, a falling UK market and the credit crunch.  I don’t think I’m the only one, but I’m one of the only ones who’ll stand up and say it.  I’m sure I’ve perceived a significant drop in footfall at the show this year, so I recon a lot of the hangers on have left the industry, and I know from the gossip that I’m not the only one who’s felt the pinch this year.  If you want the slides from my talk, which was based around an article I wrote for this magazine with a similar title, drop me an email and I’ll fling them to you FOC – just cos I’m a nice chap.  I received an email from someone after the show saying that it was the best talk he’d been to all weekend.  I only hope that he’d been to at least one other talk!

You can tell from the type of stall at the show how the market is evolving in response to the troubled times in the UK property industry and beyond.  The show was virtually devoid of UK housebuilders showing their latest wares.  The buy-anything-and-everything crowd really has left this industry for the foreseeable future.  Gone also are the fool’s gold sellers from many of the ‘hot spot’ areas that have, rather predictably, turned into ‘not spots’.  Gone also are some of the big name stands that formerly graced the entrance area – or blocked it, depending on your point of view.  And, I’m also told, one very famous name in property training is soon to be gone out of the industry for good.  Hurrah!  Good riddance to bad rubbish.  You all know who I’m talking about, and you’re quite right:  I don’t dare say it!

These times, they are a’changin…..  will the new wind propel you to your investment destination, or smash your ship onto the rocks?