By D.C. Fawcett, Business Building Coach to the Foreclosure Industry

When real estate investors evaluate their options for securing deals and making profits, there are several things that may come to mind. Whether its owning rental properties, fixing up properties in disrepair, or working short sales, the business of real estate is a proven winner and especially so in today’s economy. 
Where do most investors start when they seek opportunities in buying foreclosures?  They might start working with a realtor to find bank owned foreclosures. When a property is lost via foreclosure it goes back to the bank and then becomes one of the now thousands of bank owned foreclosures (or REO properties) on the market today. This side of the business is highly lucrative in today’s market.

Another option that is also very relevant to investors is the short sale, where investors negotiate discounts on properties before they are foreclosed. This can also be highly lucrative and the key to success here is to educate yourself properly. Free real estate investment training programs are out there, even in your area or certainly online, and everyone has to start somewhere. Every investor’s needs are unique and so too should be your training in learning how to successfully complete short sales and other foreclosure deals.

I think buying foreclosures can be risky for the investor because, without some sort of education (including free real estate investment training), you run the risk of not really knowing what you are doing. Profits can be lost and so too can opportunities from buying foreclosures when you miss out on free real estate investment training opportunities that exist. Start today by doing an Internet search to see what free real estate investment training programs are out there. What do you have to lose?

In today’s market, there are indeed unlimited deals to be found within the world of  foreclosures. Whether you’re just curious how to make a little extra money with buying foreclosures or really want to pursue a serious business, you owe it to yourself to seize the current opportunity and pursue it. Free real estate investment training programs are there for you and can help make this happen!

While more comprehensive training programs are recommended, take advantage of the free real estate investment training opportunities that are out there because the deals are out there waiting. I highly recommend that you commit yourself to your own real estate education and a free real estate investment training is a great place to start, allowing your pursuit of buying foreclosures to be more productive and more rewarding. I wish you the very best in success in all of your investing pursuits and in business as a whole.

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When I first got started in real estate investing, I read a LOT of books. One thing I seemed to hear again and again was “Whatever you do, do NOT become a real estate agent if you’re going to be an investor.”

As a new investor, I believed most of what I read and heeded that warning, but it always stuck in the back of my mind and I found myself wondering why you wouldn’t want to be both.

After some research, I found that the big reason you’re not supposed to be an agent AND an investor is that as a real estate agent (or broker, or Realtor), you’re held to a “higher level of responsibility”.

If a dispute ever arose between you and someone you were involved in a transaction with, it could be argued in court that as a licensed agent, you knew more than the other party, had an unfair advantage and used your additional knowledge to take advantage of the less knowledgeable party.

Herein lies the big question.

Do you plan to take advantage of someone you’re doing business with?

Hopefully, your answer is “No.”

As a real estate investor and/or agent, it’s our ethical obligation, licensure aside, to put together fair, legal and “above board” deals.

So if you’re putting together deals ethically (as I hope you are) then it begs another question:

Why would you want to be both an investor and a real estate agent?

As an investor, when you approach a homeowner and talk to them about their property, you may realize that it’s not the best deal from an investment standpoint, but it would make for a good listing.  There have been many cases where I had a property that just didn’t fit my investment criteria, but it made more sense to list. In these cases, we listed and sold the properties on the market and took our commission.

In addition, as an agent, you get leads for sellers looking to sell, some of which may be better opportunities as investments.

As a real estate agent, what happens when you’re meeting with a seller and you realize that the deal you’re looking at has a lot of upside potential, and you would rather pick it up yourself?

Simply switch hats, put the listing paperwork away, and put on your investor hat.

What kind of opportunities do you miss out on when you’re only an agent?

A fellow real estate agent at an office where I used to work was a top sales agent. He would knock through 300 cold calls a day, line up dozens of closings a month, and top the charts in the office month after month.

He was a fantastic real estate agent.

One day, he came across a listing where the seller wanted to simply “walk away.” In investor speak, this was a “Motivated Seller.” The seller was leaving over $90,000 on the table and was wanted to be done with the property and move on.

Our fellow agent listed the property, brought it to closing and the seller walked away with a check for just over $90,000. Our agent friend was busy working on other deals when he got a post-closing call from the seller looking for help.

The seller didn’t know what to do with the check, didn’t have any place to put it and just needed some money to put gas in the rental truck on their way out of town.

As a real estate investor, our friend could have solved the sellers problems from the get go, helped them with the move, put some cash in their pocket and taken away the problem property all while hanging onto the excess $90,000.

So when it comes down to choosing between being a real estate investor, an agent or both, I hands down choose both every time.

It gives you more options and opens more doors to more deals.

Jeremy B. Shapiro
http://www.articlesbase.com/real-estate-articles/real-estate-investor-agent-or-both-734503.html

Today, everywhere you look, there are commercials, billboards and roadside signs by entities offering to help you prevent a foreclosure of your home. Known as Foreclosure Consultants, some, if not many of these services and the persons whom they employ may be acting in violation of the strict regulations in California which regulate this growing industry. Others, may be outright frauds and scam artists.

 

The focus of these foreclosure consultants is anyone who is behind on their mortgage payments, which is now estimated to encompass one out of every ten homeowners. However, those who seek to defraud the public have their focus especially on the elderly, the newly unemployed, those whose properties are entering foreclosure and those whose payments have recently spiked upwards.

 

If you’ve been the victim anywhere in Southern California of real estate fraud or the target of an unscrupulous loan modification service, foreclosure consultant or someone acting on your behalf to modify your mortgage or cure your problems who is in violation of the strict regulations discussed in this article, call the Law Offices of R. Sebastian Gibson at any of the numbers on our website at http://www.SebastianGibsonLaw.com .

 

If you are a licensed real estate broker or agent and have either been wrongly accused of being in violation of the laws and regulations governing loan modification services and foreclosure consultants, or acted as such without being aware of these strict regulations and need legal defense, we urge you to call us at any of the numbers which you can find on our website.

 

To help you wade through the regulations in California on such services, here are some of the most important regulations. Keep in mind, that there is some overlap between foreclosure consultants and loan modification services. For that reason, the laws and regulations governing both services are included.

 

California Civil Code Section 2945 regulates foreclosure consultants. There is an additional requirement with respect to loan modification services, as discussed below. As with many code sections, the restrictions are complex and many. But here are the primary ways in which foreclosure consultants and loan modification services are regulated.

 

First, no foreclosure consultant and no real estate licensee is allowed to collect any advance fees for services as a foreclosure consultant once a Notice of Default has been recorded against your property. California lawyers are exempt from this prohibition.

 

Second, even if a Notice of Default has not been recorded against your property, in order for a real estate broker to assist you in obtaining a loan modification, or to otherwise negotiate a possible resolution to your problem, the broker must have you sign an agreement that specifically states what services will be performed, when they will be performed and how much you must pay.

 

Third, a broker may not have you sign any such loan modification agreement until it has been submitted to the Department of Real Estate for review and the broker has received permission from the DRE to use it and collect an advance fee.

 

Fourth, licensed real estate brokers who provide loan modification services without collecting fees in advance are not required to receive the DRE’s permission so long as their services are fully completed before they are paid by you.

 

Fifth, foreclosure consultant contract must allow the homeowner the right to cancel the contract until midnight of the third business day as defined in Section 1689.5 of the California Civil Code.

 

Sixth, foreclosure consultant contracts must provide an additional notice to the homeowner in 14-point boldface type stating when fees can be taken and notifying the homeowner that the consultant cannot ask you to sign any lien, deed of trust or deed.

 

Seventh, it is a violation for the foreclosure consultant to claim, demand, charge, collect, or receive any compensation until after the consultant has performed each and every service the consultant contracted or represented he or she would perform.

 

Eighth, it is a violation for the foreclosure consultant to charge any fee or interest which exceeds ten percent per annum of the amount of any loan which the foreclosure consultant may make to the owner.

 

Ninth, it is also a violation for the foreclosure consultant to take any wage assignment, consideration from any third party, acquire any interest in the residence in question, take any power of attorney, induce the owner to sign other contracts which are not in compliance, or enter into an agreement to assist the owner to obtain surplus funds prior to 65 days after the trustee’s sale has been conducted.

 

Tenth, an action may be brought against a foreclosure consultant for any of these violations and judgment shall include actual damages, reasonable attorney’s fees and costs, equitable relief and exemplary damage of at least three times the compensation received by the foreclosure consultant. The foreclosure consultant may also be punished by a fine of up to $25,000.00 or imprisonment for up to a year or both for each violation.

 

The reason for these regulations are many. Foreclosure consultants have, in many cases, been found to charge high fees, require the payment to be secured by a deed of trust on the residence, and then have either performed no service or worthless services. Some foreclosure consultants have then been known to purchase the homes at a fraction of their worth shortly before the homeowner loses their home.

 

Additionally, some foreclosure consultants have required payment of exorbitant fees for services such as to obtain the remaining funds from a foreclosure sale when the homeowner could have obtained those remaining funds from the trustee of a trustee’s sale directly for minimal cost if the homeowner had sufficient time to receive notices from the trustee regarding how and where to make a claim for excess proceeds under Civil Code Section 2924j.

 

Among the services foreclosure consultants are known to offer, legitimate or otherwise, are to stop or postpone foreclosure sales, obtain forbearances from beneficiaries and mortgage companies, assist in getting reinstated, obtain extensions of time, obtain waivers of acceleration clauses, assist in obtaining loans and advances, avoiding or ameliorating the impairment of the owner’s credit, saving the home from foreclosure, and assisting in obtaining the remaining proceeds from the foreclosure of the residence. If a foreclosure consultant promises any of these services, he or she is bound by Civil Code Section 2945 discussed above.

 

If you are dealing with a loan modification service, even one with a contract which has been submitted to the DRE and the broker has received permission to use it and collect an advance fee, if the real estate broker does not follow the strict procedures for handling the advance fee as contained in California Business & Professions Code Section 10146, the agent will be presumed to have violated Sections 506 and 506a of the Penal Code and the homeowner may recover treble damages for amounts misapplied and shall also be entitled to reasonable attorney fees in any action to recover those amounts.

 

Representatives of foreclosure consultants must be bonded real estate licensees. Foreclosure consultants must also be bonded and registered with the California Department of Justice (and submit advertising and promotional materials) and the homeowner must be provided with written proof that the consultant’s representative has a valid California real estate sales license, and is bonded in an amount equal to at least twice the fair market value of the property in question. If the foreclosure consultant performs any activities which include negotiating loans or performing services in connection with real property loans, the consultant must also be a real estate licensee.

 

While real estate agents are in some respects exempt from the foreclosure consultant regulations contained in Civil Code Section 2945, they are subject to it’s regulations under certain circumstances and it is in those circumstances that a real estate agent can be in violation of the Act. If they collect fees once a Notice of Default has been recorded, if they collect advance fees before acts have been performed, if they acquire an interest in a residence in foreclosure, if they assist the owner in obtaining the remaining proceeds from the foreclosure sale, or if they make a direct loan for a residence in foreclosure, they may be in violation of the foreclosure consultant laws.

 

A real estate broker cannot collect an advance fee under California Business and Professions Code Section 10026 unless the broker has submitted to the California Department of Real Estate an advance fee agreement for approval.

 

A loan modification contract, even one with a licensed real estate broker, for their assistance in working out a loan modification or negotiating another resolution of your problem must still state what services will be performed, when they will be performed and exactly how much you must pay. If the fees are to be collected in advance, the contract must be pre-approved by the Department of Real Estate.

 

At the Law Offices of Sebastian Gibson, we specialize in the field of real estate and stand ready to assist you if you have been the victim of any type of real estate scam. If you have lost money or your house to a foreclosure consultant or loan modification service as a result of their wrongdoing, we can assist you in pursuing the parties who victimized you and in some instances, we may be able to seek not only any moneys paid to them, but also, in some cases, your other actual damages, equitable relief, reasonable attorney’s fees and costs and punitive damages of three times the compensation received or misapplied by the foreclosure consultant or loan modification service who contracted with you.

 

If you have a business or real estate legal matter in Palm Springs or Palm Desert, in Ontario or Rancho Cucamonga, Temecula or Murrieta, Newport Beach or Huntington Beach, Anaheim or Santa Ana, El Cajon or Carlsbad, Palmdale or Victorville, Long Beach or Santa Monica, Ventura or Oxnard, or anywhere in Southern California, our Palm Springs, San Diego, Orange County, Inland Empire, Los Angeles, Santa Barbara and San Luis Obispo law firm has the knowledge and resources to be your Business Lawyers and Real Estate Attorneys. If you’ve been the victim of a real estate, business, loan modification or foreclosure scam or fraud, be sure to hire a law firm with experience in loan modification, foreclosure and real estate fraud in California and who will endeavor to ensure that your rights are properly represented.

 

To learn more about the statutes which regulate loan modification and foreclosure consultants, or for legal representation, call the Law Offices of R. Sebastian Gibson at any of the numbers on our website at http://www.SebastianGibsonLaw.com .

R. Sebastian Gibson
http://www.articlesbase.com/national,-state,-local-articles/california-loan-modification-fraud-lawyer-foreclosure-consultant-fraud-attorney-damages-for-scams-ripoffs-frauds-and-statutory-violations-684644.html

Beginning investors who find themselves strapped for cash often start real estate investing by wholesaling properties to other investors.

With the market in its current condition more and more investors find that they are coming across hordes of motivated sellers. Unfortunately, all of these potential prospects tend to share one thing in common. They don’t have any equity! This little dilemma is causing many investors to turn their efforts toward bank-owed foreclosures.

The single biggest advantage associated with REOs is the fact that equity can be created instantly either by finding a hot deal or through shrewd negotiation. There’s nobody telling the bank that they owe too much on a property and can’t lower the price a bit. In theory…any house could be sold for as little as a dollar.

In fact, there is only one downside to wholesaling REO properties. Non-assignability. When an investor gets a bank owned property under contract it always comes with multi-page addendums that make the deal non-assignable.

A lot of new wholesalers will consider this one obstacle to be the end of the line where flipping bank owned homes is concerned, never knowing that there are four ways to maneuver around this bump in the road.

Method #1 - Add to Contract, Then Quit Claim

Most banks do not have an issue with adding an additional party to a contract, they just do not want the ORIGINAL parties removed from it at any time. So Ivan Investor can get an REO property under contract for $50,000. Ivan calls Louie Landlord and after talking about the deal Louie agrees to pay a total of $60,000 for the property.

Ivan calls the bank up and requests that an addendum be drawn up that adds Louie to the contract and title. The Bank agrees and everyone shows up on closing day.

Louie brings TWO certified checks. One for $50,000 for the purchase of the property, and one for $10,000 made out to Ivan. All parties then show up for closing and both Ivan and Louie then own the home. Louie hands Ivan the $10,000 check and Ivan signs a quit claim deed removing him from title on that property. Pretty simple, right?

Pros: The advantage to this method is that there is only one set of closing costs. It’s a rather simple and straight-forward method that works for most deals. It works around the 90-day deed restriction that comes packaged with many Fannie/Freddie properties.

Cons: Here are the negatives that come with this method. This does NOT work for HUD properties because HUD does not allow any changes to the parties that are on the original offer and the end buyer usually cannot be getting a mortgage because a mortgage company won’t allow you to be on title if they are lending someone else money against the home.

Method #2 - Simultaneous Double-Close

The simultaneous double-close (also known as a simul close or a “dry” close) is actually two transactions. An investor is buying from the bank and then instantly reselling to a third party in a separate transaction. It follows a typical A-to-B-to-C deal flow.

The “twist” that comes with this method is that the wholesale investor never actually brings any money into play. The end-buyer’s funds are used to fund BOTH transactions. This is possible because, as long as both closings take place on the same day, it doesn’t matter which one closes first for the title company’s accounting purposes. The second transaction (B-to-C) could take place a 9am with all the paperwork for that transaction taken care of at that time while the first transaction (A-to-B) doesn’t close until 2pm.

What really matters is that the deeds are RECORDED in the proper order when filed with the county. It’s important at that time to have the A-to-B deed filed first with the B-to-C deed following on record.

Pros: This works well for those who have zero cash as long as they have a good title company that will still do these types of transactions. It still works even with end buyers that are getting conventional financing if the end buyer is getting their financing through the right lender.

Cons: This method is NOT an option if the end buyer is getting FHA financing. This method also does NOT work for Fannie/Freddie foreclosures in most cases because these super-banks put a deed restriction in place that prevents you from reselling the property to ANYONE for a full 90 days.

Also, with all double-close deals there are two sets of transfer taxes, recording fees, and other closing costs that cut into your profit. Of course you can just build that into the deal by lowering your offer price in order to circumvent this small annoyance.

The biggest roadblock to getting these transactions closed is the fact that fewer and fewer title companies are comfortable with the “dry” simultaneous close where the wholesale investor brings in no cash to the deal. In fact, they are often refusing to close these deals at all!

Method #3 - True Double Close

The true double close (also known as a “wet” close) is the same as the simultaneous close in that the investor is buying the foreclosure property and instantly reselling it to the end buyer for a profit. However, the wholesale investor is actually bringing in his own cash to fund his end of the deal.

This little difference makes the title companies happy but it doesn’t work so well for beginning investors that don’t have piles of cash sitting around to make the deals work.

Then came Flash Funding. There are “transactional funding” lenders will lend you all the money you need to do these same-day double-close deals…for a price. Most will never run a credit check or request an appraisal on the property.

The pros and cons to this method are pretty much the same as the simul close, except that on the good side more title companies are willing to do business with you if you go this route and on the bad side you have additional costs in the form of Flash Funding fees chewing away at your profits.

Method #4 - Sell The LLC

This last method has been popularized by Steve Cook who’s said that he swiped it from commercial real estate investors who have been using it for years to avoid paying transfer taxes.

The idea is that an investor would submit an offer in the name of an LLC. If the investor was placing an offer on 1221 Sycamore, he may send it in with “Sycamore Group LLC”. If the offer is accepted, the investor immediately faxes in his LLC articles of organization and creates the company to match the Buyer on the purchase agreement.

From there the investor finds his end buyer and they agree that on closing day the end buyer will purchase the entire LLC from the original investor for the amount of the wholesale fee. From there, as the new owner of the LLC, the end buyer is empowered to close on the original transaction and purchase the property.

Pros: The upside to this method is that you workaround the extra costs in the form of transfer taxes and/or Flash Funding fees that come with the two Double-Close methods, and for those who are concerned about guarding their privacy, your name never goes on the deal.

Cons: The major obstacle to this one is that the end buyer has to pretty much be paying cash. Banks do not loan traditional mortgages (either to owner occupants or investors) in company names. You have to buy it in your own personal name to get a mortgage. Other concerns are that if you do this often enough you may attract the attention of state regulators who are confused as to why you start and sell 5-10 LLCs each month.

Armed with these four workarounds, investors nationwide are able to successfully wholesale flip REO foreclosures. None of these methods require the wholesaler to bring his or her own cash into play other than the initial earnest money deposit and none require a credit check. One of these methods will work for pretty much any situation you will come across when flipping bank owned homes.

Brian Kurtz
http://www.articlesbase.com/finance-articles/wholesaling-bank-owned-foreclosures-a-definitive-guide-736881.html

It is, in fact, the certificate of purchase you as a purchaser get at tax sale. In this certificate, your ownership in the tax lien is documented. In fact, what makes investing in tax lien certificate such an attractive investment is the powerful bundle of rights that it provides to the investor.

The ultimate profit potentiality.
Being a professional and prudent investor, you can benefit from the ultimate profit potentiality of the Real estate Investing in tax lien certificates. If you stick to the basics, and work on a proper strategy, nobody can stop you from earning a huge profit. Since you just invest a small fraction of the propertys market value, you will earn a guaranteed profit on the transaction. Again, if the property owner has paid off the lien through investment, it can earn you a huge return on the original investment. If the circumstances go wrong further, the least you can get the full ownership of the property by foreclosing on the certificate. Overall, Real estate Investing in tax lien certificate is quite safe. You do not lose anything but you can gain much.

Headache-free investment.
Some investors take it in a negative sense that they do not get the ownership right over the property when they invest in tax lien certificates. However, if I show you the true picture, not having the ownership of the property in fact works in your favor. Since you do not get the ownership right of the property by purchasing a tax lien certificate, it gives a freedom from the liability of a landowner. You do not need to worry about the maintenance of the Real estate Investing property, or any other thing that is the headache of a landowner. Simply consider the rising lawsuits against property owners and you will understand the potentiality of this advantage.

Getting the ownership
At the time of the foreclosure of the property, you not only get the full ownership of the title but it also clears all other subordinate liens and debts related to the property.

Earn massive passive income
When you go for Real estate Investing in a tax lien certificate, you do not need to worry about anything. You just have to enjoy the benefits, and others will do everything else for you. It sounds funny, but this is what the ultimate passive nature of the investment in tax lien certificates is. You do not need to handle enforcement of the lien until foreclosure. The county will do it for you. In some states, they even handle the foreclosure process as well.

Purchase later year tax liens
If you act a little smarter, you can also purchase later year tax liens without any competition. If the delinquent property owner defaults on next years taxes, you do not need to participate in an action to purchase those tax liens. You can privately acquire the same. Spend some time and do your research thoroughly, and you can easily maximize the profit potentiality of your Real estate Investing.

Hence, when it comes to Real estate Investing in a tax lien certificate, the end result for an investor is always a profitable return, no matter what the outcome.

James Klobasa
http://www.articlesbase.com/non-fiction-articles/real-estate-investing-in-tax-lien-certificates-97298.html

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When I first got started in real estate investing, I read a LOT of books. One thing I seemed to hear again and again was “Whatever you do, do NOT become a real estate agent if you’re going to be an investor.”

As a new investor, I believed most of what I read and heeded that warning, but it always stuck in the back of my mind and I found myself wondering why you wouldn’t want to be both.

After some research, I found that the big reason you’re not supposed to be an agent AND an investor is that as a real estate agent (or broker, or Realtor), you’re held to a “higher level of responsibility”.

If a dispute ever arose between you and someone you were involved in a transaction with, it could be argued in court that as a licensed agent, you knew more than the other party, had an unfair advantage and used your additional knowledge to take advantage of the less knowledgeable party.

Herein lies the big question.

Do you plan to take advantage of someone you’re doing business with?

Hopefully, your answer is “No.”

As a real estate investor and/or agent, it’s our ethical obligation, licensure aside, to put together fair, legal and “above board” deals.

So if you’re putting together deals ethically (as I hope you are) then it begs another question:

Why would you want to be both an investor and a real estate agent?

As an investor, when you approach a homeowner and talk to them about their property, you may realize that it’s not the best deal from an investment standpoint, but it would make for a good listing.  There have been many cases where I had a property that just didn’t fit my investment criteria, but it made more sense to list. In these cases, we listed and sold the properties on the market and took our commission.

In addition, as an agent, you get leads for sellers looking to sell, some of which may be better opportunities as investments.

As a real estate agent, what happens when you’re meeting with a seller and you realize that the deal you’re looking at has a lot of upside potential, and you would rather pick it up yourself?

Simply switch hats, put the listing paperwork away, and put on your investor hat.

What kind of opportunities do you miss out on when you’re only an agent?

A fellow real estate agent at an office where I used to work was a top sales agent. He would knock through 300 cold calls a day, line up dozens of closings a month, and top the charts in the office month after month.

He was a fantastic real estate agent.

One day, he came across a listing where the seller wanted to simply “walk away.” In investor speak, this was a “Motivated Seller.” The seller was leaving over $90,000 on the table and was wanted to be done with the property and move on.

Our fellow agent listed the property, brought it to closing and the seller walked away with a check for just over $90,000. Our agent friend was busy working on other deals when he got a post-closing call from the seller looking for help.

The seller didn’t know what to do with the check, didn’t have any place to put it and just needed some money to put gas in the rental truck on their way out of town.

As a real estate investor, our friend could have solved the sellers problems from the get go, helped them with the move, put some cash in their pocket and taken away the problem property all while hanging onto the excess $90,000.

So when it comes down to choosing between being a real estate investor, an agent or both, I hands down choose both every time.

It gives you more options and opens more doors to more deals.

Jeremy B. Shapiro
http://www.articlesbase.com/real-estate-articles/real-estate-investor-agent-or-both-734503.html

Located on the coast of the Mediterranean South of Spain, lies the region of the Costa del Sol; whose name roughly translates into the English “Coast of the Sun”. Comprising of literally hundreds of towns and villages, the Costa del Sol is a very popular tourist destination and the number of Britons investing in property in this Spanish region has been steadily increasing each year.

That was until the global economy fell and just about everything from the monthly gas bill to stocks and shares has been badly affected since. Of course there are those with an income so high as to not feel the effects but it’s wise for consumers to button their wallets and save, save, save in the upcoming months. What this now means for the Costa del Sol is that Western property owners are stuck with the dilemma of whether they can afford to keep their holiday home on the southern coast of Spain, or whether they should sell it on and save the money for a potential economic crash.

Instead of being stuck in the middle of a very hard decision, many Spanish property owners located in the Costa del Sol have actually chosen to rent out their property, rather than selling it on or keeping it empty during the year for use in the summer. While it might mean a lot of paperwork, it actually brings in steady money to keep the family afloat in times of possible crisis. After all, if there’s a beautiful Spanish property laying empty in the centre of affluent tourist area Costa del Sol then why not take advantage of the market and rent it out?

Luckily for owners who are choosing to rent out a room or the whole property, the tourism industry remains largely unaffected by the ever menacing credit crunch. Experts claim that due to the colourful ideas that travel entrepreneurs come up with, and the growing need for people to ‘get away’ from their financial stresses, the number of people taking holidays won’t be too badly affected.

What it also means is that rather than blowing a fortune on a cruise to Barbados, many families, couples or groups of friends might settle for a fortnight in the Costa del Sol instead. It is an area not too expensive to vacation in, yet one that is just as idyllic. Take Nerja for example; this autonomous coastal town oozes Mediterranean luxury and Spanish culture. Couple that with its ideal location not far from the large city of Malaga and at the other side the Sierra Nevada mountains where tourists love to ski.

Perhaps what isn’t quite clear in the process of renting out holiday properties rather than selling them on is what the future intentions of the property owners are. The majority are looking for some financial security in steady income for the short term, and in the long term are simply hoping that the global property market will pick up. Rather than sell their favorite and most expensive asset, they’re looking to hold onto it either until they are financially comfortable and can retire to the Costa del Sol, or so that they can sell it on for a much higher price. Makes sense, right?

At the moment the market for vacation or holiday property anywhere in the world is very illiquid. That is to say, the market’s assets (the properties) cannot be sold at a price equal to the one they were bought for. This is a great problem for the property owner as the whole idea in getting onto the property market is to make a return on the initial investment (otherwise known as ROI). If this isn’t done, then a great loss has been made. Now that the economy is in such trouble due to the Credit Crunch, the property market is nose diving and owners are biding their time until the average sale price rises once again.

So what should you do if you’re a Spanish property owner, particularly in the Costa del Sol? The answer is, sit on your investment and get all you can from it; whether that’s enjoying it yourself or by renting it out to other keen travelers to gain some extra income. Every penny counts at the moment!

Lucy Wallace
http://www.articlesbase.com/real-estate-articles/costa-del-sol-holiday-rentals-why-owners-have-turned-to-renting-their-properties-671921.html