March 23rd 2011
By Neil Jenman
Stephen Terence Fagan was born in Scotland in 1963. Soon after he started school, when he was still in short pants, little Stephen migrated to Australia with his mum and dad. He grew up to become a property spruiker and, just like scores of Australian property spruikers, he claimed to control a 'club' or a 'group'.
Back in 2004, when the Sydney property market was red hot, Steve Fagan was a director of a mob called the Princeton Property Group. Today, in 2011, he works with a female property spruiker who claims to control a property 'club', - but more of that in a moment.
Let's stay in the past before we show how it links to today.
In 2004, Steve Fagan's Princeton Property Group claimed to have been incorporated almost twenty years earlier, in 1985. It seemed sound and solid. It claimed to have "helped over 800 families become property investors and start on the journey to…." Blah, blah, blah, you know the rest.
The message from spruikers always has the same pitch: Buy property and get rich.
As well as being a property spruiker, Steve Fagan also did what many spruikers do - he wrote a book on, of course, how to get rich in real estate. It was called 'Accidental Millionaire' and it was filled with the typical property spruiker drivel that ranged from flat-out-wrong to downright deceptive.
For example, in his book (and in his spruiking pitch) Steve Fagan claimed that "87 per cent of the world's millionaires come from the field of property investing." That's not true. The truth is that virtually none of the world's millionaires got rich from real estate - and very few, if any, get rich by taking advice from the likes of Steve Fagan.
Fagan also claimed that "Residential property has doubled in value every seven to ten years on average. That's right. It's (sic) doubled in value without fail every seven to ten years! And that has been going on consistently for the last 150 years."
But, still, let's have a look at just one of Steve Fagan's investor clients and see what happened to them - over almost seven years - when they took the advice of Steve Fagan and his Princeton Property Group.
Nick and Wendy are a delightful young couple. In 2004, after advice from Fagan's property group, they purchased an apartment in the western Sydney suburb of Blacktown. They paid $325,000.
Three years later, in 2007, Nick and Wendy were buckling under the strain of their investment property. It was costing around $1,300 a month to hold the property. When they made enquiries about selling, they were told that the apartment was worth around $230,000, almost a hundred thousand dollars less than they paid for it three years earlier.
Nick and Wendy contacted me, Neil Jenman, and asked for my help. I contacted Steve Fagan and asked him to discuss Nick and Wendy's case with me. When I met Steve, he told me that he was most "concerned" to hear that some of his customers were not happy. We also discussed his book and I pointed out the many errors in it. Fagan said he was shocked that his information was so wrong but he agreed to never make such claims again. That was a decent and proper thing to do.
As for Nick and Wendy, well, Fagan had a simple solution: he would buy the property back from them for the price they paid for it ($325,000). He would also refund all their expenses. What a good man. At last, I thought, maybe I have met a decent spruiker.
Fagan went further than just making a verbal promise; he repeated the promise on camera. At the time, the ABC's Australian Story was interviewing me about my work. Knowing that much of my work is negotiating with spruikers to compensate their victims, the ABC asked to interview a spruiker, in this case Steve Fagan. Sure enough, Fagan looked straight at the camera and repeated his solemn promise to buy back the apartment from Nick and Wendy. What a guy.
In October 2007, Fagan was relieved to see that he had been left out of the episode of Australian Story, however he assured Nick and Wendy that he would honour his agreement.
By this time, you probably know where this story is heading.
That's right, almost four years after he made that solemn promise to Nick and Wendy, Fagan had not bought back their property. He had given Nick and Wendy years of broken promises and excuses. They had no choice but to sell their apartment on the open market.
At the end of 2010, almost seven years since they bought the apartment from Fagan, they sold it for $269,000, a gross loss of $56,000. With expenses this lovely young couple have lost around $100,000 on their property investment deal through Steve Fagan. They now have a loan for the amount of their losses, almost $100,000 - and nothing to show for it.
If Fagan's claim about property doubling every seven years was true, their apartment today, in 2011, should be worth $650,000. Of course, it's not.
Recently, Fagan has been working with Carly Crutchfied, another spruiker who claims to be a multi-millionaire thanks to property. Carly has set up the "Carly Crutchfield Club" which she describes as being for "members only". The "club" promises to give you access to some "inside information and secrets that will massively increase your wealth." Yeah right.
Perhaps, from working with Carly and her "club", Steve Fagan is now a reformed spruiker. But, still, despite both he and his new spruiking buddy, Carly, claiming to have done "hundreds of millions of dollars" worth of property deals, Steve Fagan continues to avoid Nick and Wendy when they try and chase him to keep the promise he made - that he would cover their losses.
At one stage, I must admit, Steve Fagan almost got me. He seemed so sincere. When he spoke into that television camera, he looked authentic.
But no, Steve Fagan has done what many spruikers do.
Stephen Fagan has been a big disappointment.