The true secrets of real estate seminars

Inspired by the idea of getting rich in real estate? So was one of our readers. Learning the truth almost cost her $30,000.



From the February/March 2012 issue of the magazine.


About 20 years ago, a late-night infomercial featured Tom Vu, a Vietnamese immigrant with a rags-to-riches story. A grinning Vu stood on a yacht surrounded by girls in bikinis, or in front of a mansion with a fabulous fountain and a Bentley in the driveway. During these cheesy ads, Vu would promise that you, too, could learn the secret to making millions in real estate just by attending his free seminar.

While Tom Vu is no longer in the real estate business (he was later reincarnated as a professional poker player), his legacy remains. Chances are you’ve come across more than one late-night commercial, email or full-page newspaper ad making a similar claim about becoming financially secure through real estate investing.

This is exactly the promise—from a well-known Canadian TV personality—that enticed Fernanda Caranfa, a former teacher, to attend a free seminar in Toronto. Caranfa listened to evangelical testimonials from people who had quit their six-figure-salary jobs after only one year and went on to double, even triple their net worth through real estate investing. The stories convinced Caranfa to charge almost $30,000 to her credit card for the “comprehensive educational system” and 12 months of ongoing support. Within weeks she’d regret her decision.

No one knows exactly how much is spent on these real estate seminars and their “educational programs,” but they continue to crop up in hotel conference rooms across Canada. And judging from the dozens of websites created by would-be property moguls, there are a lot of dissatisfied customers. “These seminars don’t have to be a scam,” says Victor Ricciardi, finance professor at Goucher College in Baltimore. “But they do employ highly questionable ways of parting you from your money.” Here are the most common.


Many seminars plant someone in the audience to guide the group toward a certain way of thinking. “You only need one or two dominant people to influence up to 10 others,” says Ricciardi.

These plants may offer testimonials, ask leading questions and make supportive comments throughout a presentation. Or they’ll inject a sense of urgency by being the first to sign up for such a great deal, enticing others to follow lest they feel left out.

“Don’t underestimate the power of groupthink,” says Ricciardi. Even the most skeptical investor can be drawn in. “Studies show that even risk-intolerant people will become risk takers when engaged in groupthink.”

Borrow and invest, ignore the rest.

Just about every group heartily promotes the use of leverage, whether it’s taking out a loan against your home or maxing out your credit cards. The more you borrow, they say, the more you’ll invest, and the more you’ll earn. For example, according to Don Campbell, president of the Real Estate Investment Network, if you’d invested 15% on a rental property between 1985 and 2005, when Canadian real estate appreciated by 5.1% annually, you would have earned a 33% yearly return.

What they don’t tell you is that these high-debt tactics also magnify the impact of falling home prices. If values decrease by 10% or 15%, you could kiss your equity goodbye. And corrections do happen: between 1981 and 1985, Calgary home prices plummeted by 40%, and steep declines have also occurred in Vancouver and Toronto. They will happen again.

The first one’s free.

Many would-be investors attend these seminars because they’re free. But as Caranfa discovered, the first presentation is just a come-on for expensive seminars and programs that follow.

After attending a half-day free seminar, Caranfa spent $2,000 on a three-day weekend workshop. She thought she’d learn about making money in real estate, but instead she was subjected to yet more success stories and promises that she’d get rich once she’d mastered the “secrets” taught in the full course, which cost a whopping $25,000. While Caranfa was skeptical, she eventually forked over that fee.

Caranfa thought her money was being invested in real property, but it wasn’t. All she got was “a few flimsy books, a couple of DVDs, and the chance to fly all over the U.S. for a series of three-day boot camps on how to invest successfully.” She’d paid almost $30,000 for little more than vague information she could have found for free.

Within 30 days, Caranfa started to ask for her money back and, predictably, she got the runaround. That’s when she called MoneySense. Once we got involved, the program coordinators relented and reimbursed Caranfa. “Eventually I got my money back, but I felt so stupid and foolish.”

But that’s just part of the scheme, says Ricciardi. “Skeptics will often get their money back, but only because this can reinforce how legitimate the program is to other investors.” For programs like this to make money, he says, only a small percentage of people have to be willing to buy into the inspirational message. Understanding how these seminars work will ensure you’re not one of them.

11 comments on “The true secrets of real estate seminars



    • Seriously…we need to get this message out there, they put up fake testimonials of people who haven't even done anything, they just ask them questions like:
      "What did you think of what you learned today?", in their excitement the people will answer "ohh so & so taught me so much" …and it looks like they've actually done something.
      Been burned by these fakes before, dont waste money on a seminar!


  2. There are so many of these scam artists out there today who insist that you need to "educate" yourself on how to buy a home in Florida or somewhere else in the US. Instead what you do with them is buy a 3 day seminar for $2000 then at the end of the 3 days they want you to buy coaching (upwards of $20,000) and you get nothing out of it…only lighter pockets.
    These scammers have radio shows and have appeared on TV, so be careful, instead of buying a seminar or coaching….BUY A PROPERTY! Some of them claim to be Canada's expert and mentors on US real estate….here's what that really means…I'm slick and can smooth talk a lot of BS to get you to buy my seminar at which I then get you to buy my coaching. STAY AWAY FROM SEMINARS!
    You're better of spending your money on an actual investment.
    There are REAL services that exist that can help you find an purchase a great investment property or vacation property….try any real estate investment management firm. If you can't do anything else then buy a REIT for $1000 and make some money.

    Good luck and be careful.


  3. HAHAHAHAHAHA, I went to that seminar, Fortune Builder
    they try to $30,000 from me. I am not stuped


  4. My wife and I went to the Rich Dad and paid for the courses. We have our first flip sold, are managing two more and doing well. The mentor we have has aided us at no additional cost for more than a year to walk us through each step. Scam? Some may be, but we have gotten out money's worth and more!


  5. Just attended one of these seminars in PA that was so called sponsored by Doug Hopkins although it was his face on the poster and 2 video clips…the $1997 three day course was definitely a class to offer up-sale of the 20k-70k advanced class. I feel mislead because this was not explained during the free seminar. I will hear anyone out about an opportunity as long as he/she is honest. This experience is a lesson learned. Unfortunately I do not have recourse because the class option/packet had to be refunded in the first 3 days and of course and conveniently the three-day course was three weeks from the purchase date. I plan to write a letter and express my concern and disappointment but not sure if this will do anything or even make it to a person or legitimate business. I do not trust or believe anything I was told now and believe I paid $1997 for a binder and useless certificate. Oh forgot to ask there was the promise of up to $500k in loaned funds to help with funding the 1st deal. Learned today that money has specific restrictions and available after you are a ‘seasoned’ investor. Disappointed.


    • GG, I’m so glad I found your comment. Just today I signed up to attend the 3 day seminar for $1997 dollars in California. Of course they promised up and down that the $500k funding is for anyone who completes the 3 day seminar. Too good to be true in this case turned out to be too good to be true indeed.


  6. They use a very very skillfull convincing speaker and before you know it you are making a cash advance from your credit card for US$15,000 + the $3,500 for the 3 day seminar. Ask me what company name they use and who the speaker is. I’ll tell you but I have to protect myself too. Before long they will be changing their company name again.


    • Hi Bee, how can I find out what company you’re referring to?


  7. I see that Caranfa is actually a Realtor… That’s appears strange. She obviously sees value in r/e investing.


  8. I have just attended one of these in Toronto and I saw their ‘move.’ coming so when they asked for $35000 to join their network of people like me I politely declined and yet I was amazed at how many people were signing up and paying $35000 .I must be in the wrong business


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