The regulator has launched legal action against a property company that has allegedly told consumers it can buy houses for $1.
Federal Court proceedings have been instituted against We Buy Houses and Rick Otton for alleged contraventions of the Australian Consumer Law.
The Australian Competition and Consumer Commission said consumers have allegedly been told that they can learn at seminars how to buy a house for $1.
Consumers have also allegedly been told they can learn how to build property portfolios without their own money invested and without new bank loans.
“The ACCC alleges that the strategies do not enable consumers to buy a house for $1 but rather involve consumers acting as middlemen to facilitate property transactions between third-party sellers and third-party buyers,” the ACCC said.
The regulator is seeking penalties, permanent injunctions and corrective advertising against We Buy Houses and Rick Otton. It is also seeking a disqualification order against Mr Otton.
Mr Otton said he would vigorously fight any action to ban his book, How to Buy a House for a Dollar.
“It seems that the ACCC thinks the public are fools, that they will take the title literally and think that they only need a dollar to buy a house,” Mr Otton said.
“People know that the expression is often used in business: to buy a business for $1 – that is, for the value of the debt owed by the business.”
Mr Otton said his strategy involves investors taking over the properties of struggling mortgagees along with their loan repayments.
He said that for the ACCC to call his book’s title misleading would be akin to regarding a sign for a garage sale as misleading because the garage isn’t actually for sale.
“My book gives people alternate ways of owning their own home by changing how they can creatively buy and sell property,” he said.
“Is it a good thing that too many Australians are still locked out of the market at a time when prices continue to rise? We aim to empower them with the knowledge that there is another, better way.”
The matter is listed for a directions hearing in Sydney on 1 April.