Investment Property Highlights - 2008

As the year draws to a close we have taken a step back from an incredibly busy couple of weeks to look at the past few months.

We started this blog in August this year for a couple of reasons. Having been involved in various sales businesses as well as the property industry we have seen no end of scams, schemes and dodgy business practices go on. We have also seen a large number of opportunities go unnoticed, as well as a large number of investors being hauled into things they really don't understand.

The whole point of this blog has been to enlighten the public as to what is going on in the world of investment property, good and bad. Sadly during 2008, most of our time has been occupied covering the doom and gloom and the shadier side of the business.

In August we covered Panama and the "Sheep Factor". Rumour has it now that some developments may not be finished now due to lack of financing. We also covered what the collapse of Fadesa meant to purchasers buying outside Spain. Possibly the first of many developers to go by the wayside.

September bought us the collapse of another developer, Colonial, followed rapidly by the Viva Estates and Ocean Estates, not forgetting the infamous Inside Track/Instant Access saga. Vivas' Expo centre has now completely closed and been stripped of furniture, Instant Access is still trying to squeeze more money out of clients and fend off the heat by simply changing directors.

October saw the exposure and gall of Red Hot Homes resurfacing, rearing its ugly head again. To this day, the site has been modified slightly (mainly to remove the mention of Channel 4) We also saw Dubai developers claiming there would be no knock on effect for them from the recession.

November was a quiet month, the main focus being on Dubai, the rumour and the confirmation of massive job cuts by DAMAC, we did state here that there would be a substantial drop in prices in the region, only to see 50% off sales a couple of weeks later.

December has been an insane month. We started with another company called inside track that had mysteriously disappeared with everybodies cash, followed by coverage on fractional ownership. This article did generate a response from the company, inviting us to attend their seminar free of charge, as well as admit their website needed updating Needless to say we declined on the account of the need for anonymity required for this type of reporting. Their website (at time of writing) has still not been updated.

To date, the biggest post of the year. (UPDATED 08/01/09) Has had to be removed due to unfounded legal threats against innocent parties.

The final article of the year though is one we are surprised no-one had picked up on. Fortuna Land and Oanna Group has been running for some time and received huge press coverage in the UK and abroad. All the "authorities" in the industry were happy to republish the badly translated articles by El Pais, yet no-one did any research into the background of it all and actually inform people how it all came to be. Granted, it took us a while, but fantastic reading if a little astonishing.

What can we expect from 2009?

Well doubtlessly many more companies are still to fold or go into difficulties, we'll report as we hear about them. No doubt there will be more scams and cons to cover too.

On the positive side?

Brazil. A slow burner admittedly, but it has the economic infrastructure to become a major player in the world in general, saving any natural disasters or political uproar, the safest bet for the mid term.

The US Dollar. With Barack Obama about to take the hotseat, we will without doubt be seeing some "feel good" economy factor. The Dollar is highly likely to rise during the first quarter of 2009, so if you are sat on Sterling at the moment going down in value, a bit of currency trading might be an idea. When you sell your Dollars though, go into Euro until the Pound sorts itself out.

A happy new year to you all, the comments we have had so far have been positive, both from the public and the industry. It is a great shame we have to remain anonymous, but having seen some of the lawsuits that have been flung about in the past, we'll stay the way we are for now.

If you would like our reports as we publish them, (and like us, haven't got this "RSS" thing figured out yet,) click on our home page here, Investment Property Rumours On the right hand side you will find a box that says "enter your email address" from FeedBurner. Enter your email, confirm the subscription, and every time we publish you'll be sent it in your email!

Red Hot Homes - Some Scams Dont Know When To Stop.

Well folks, we have sent out all the ferrets and weasels into the investment property robbery world on this one!

This is the low down on how particular individuals can come back time and time again to haunt the public, even using the same company name!

There are references here to several companies, some of which are no longer live on the web, but we have linked to some interesting comment where we can. If anyone has any complaints (Chris Devlin or Martin Devlin) please, do feel free to post. If we are proved wrong we will happily and publicly retract any postings. We are waiting by the laptop. As usual, the Investment Property Rumour Mill takes no responsibility for your opinions on what we write, but we will play fair.

This is the tale of some serial fraudsters that will stop at little to relieve you of your cash under the guise of a property investment. They return after at least 3 failed property companies, an after sales company that has fallen off the face of the earth, a police investigation, an offshore company in the British Virgin Islands and no end of complaints. Yes, at least one of them is back, Chris Devlin.

In the forums and bars it is well known that the Devlin Brothers Chris and Martin used to own Golden Coast Estates then Red Hot Homes, and also set up The Diamond Experience to take care of the after sales. (Basically tie you up with their lawyers, furniture people, money movers and so on, all designed to relieve you of as much cash as possible) Now we see two horrifying and galling prospects. List4Leads and the return of Red Hot Homes for more fraud.

Golden Coast Estates was set up some time ago now by the brothers, along with a partner Brian Nelson, (click the link and you will be taken to a forum posting from his wife about Golden Coast Estates.)

The posting itself appears to be a very frank and honest account of the situation.

So, after Golden Coast Estates ceased to exist, with Brian left to cover the debts, Red Hot Homes appeared, followed in tandem with The Diamond Experience. RHH proceeded to sign deals and collaborations here and there in the race to catch up with the main competition of the time, Macanthony Realty International, even to the extent of staff poaching and all sorts. Chris Devlin was at the front of the operation, driving the sales force, seeing that agents were signed up and generally creating hype. Some agents were mysteriously overpaid by Red Hot Homes, apparently at the time a gesture of goodwill. Little did anyone realise that it was merely a ploy to haul in more leads that they didn't declare sales on, no doubt sent on to being rinsed through a later scam, List4Leads.

From there we saw the cogs begin to grind to a halt, and as they did so alarm bells began to rang. Agents had been asked to invoice Red Hot Homes in the British Virgin Islands of all places, a handy little offshore jurisdiction for the amateur tax evader and scam merchant where little law applies and you can filter out money into seemingly nowhere.

Agents where looking for there money after confirming that clients referred had paid, the responses being that "We are waiting for payment from the developer", or "The charges that we split for the inspection trips exceed the commission we owe you, in fact you owe us money"

Eventually unpaid staff left, still unpaid to find other jobs, apparently RHH still ran from an apartment in Estepona or San Pedro on the Costa del Sol. The deal now though was to have clients send the money directly to Red Hot Homes instead of the developer. This way the money could be neatly stolen with the developer never being paid and all the cash neatly disappearing.

Since then, we have seen the attempted rise of List4Leads, owned by Christopher Devlin. This is a site that apparently will generate leads directly for you so you can sell your property. It is set up from the back of a Point2 franchise (A legitimate MLS type portal designed to give agents the ability to share properties and expand their site.) In this particular case, Devlin is using the List4Leads.com domain for the Point2 portal base, and then using List4Leads.info for his own site, hoping that no-one will notice. A whole bunch of spelling mistakes and poor formatting which would suggest stolen content, all in a bid to look bigger than it all really is. Payment for this "service" is by credit card that just happens to auto debit every month (how handy!) or, by bank transfer, but you have to pay up front for 3 months minimum. Ask yourself, what happens when the site goes down and they have an auto debit on your card?

The most astonishing thing though is yet to come. RedHotHomes.co.uk is back to scam more people!!!

The site is registered to a Ben Sykes, an SEO specialist in the UK. Ben is likely unaware of the previous activities of the Devlin's being as the domain at the time of writing is in his name. Nice try to deflect the heat this time eh?

As it stands at this moment in time, there are numerous errors on the site itself, even though it appears at the top of google, they have still left some of the pig Latin used by programmers in the pages to bulk the page out for testing.

Whilst browsing through the site and seeing Christopher's name appear, we then discover an endorsement from none other than Channel 4's Location, Location, Location presenter Kirstie Allsopp! (Note on the site they have managed to spell her name wrong, Kirsty Allsop, instead of Kirstie Allsopp. Another clever ploy Mr Devlin!

As for the whereabouts of both Martin Devlin and Chris Devlin, it has been suggested that Martin Devlin was arrested and later bailed on fraud charges. We will state this is unconfirmed here say at present, but are looking to confirm it shortly. As for Christopher Devlin? Well rumour has it from a couple of sources that he was being looked for at this years SIMA industry exhibition in Madrid. According to the forums, a detective Chris Gay is looking into fraud committed by the pair over Red Hot Homes.

Some simple advice.

If you are approached by one of these companies or individuals, beware!

Any investment you make will disappear.

Any service you pay for is unlikely to be provided.

If you are mad enough to work for them or apply for a job, you are unlikely to get paid.

Have you been approached or contacted by these scammers? Post below, we would love to hear from you.

Spanish Developer Colonial, The Next Martinsa Fadesa?

This week we see yet more doom and gloom emanating from sunny Spain in two hefty stories.

The first is regarding the ongoing process of sorting out developer Martinsa Fadesa. In a post on Saidiavacations.com by David Hewitt, Fadesa have failed to file it's half year accounts on time with the CNMV (The Spanish equivalent of the Financial Services Authority) with respect to it's finances. The reason for the delay apparently is two-fold, firstly Fadesa want the approval of the liquidators, and secondly "The chairman of the company, Fernando Martin, declared personal bankruptcy shortly after the company went into liquidation in an effort to separate his personal assets from those of the company." It is claimed that the filings will be made in "A few days more"

A few points of what this likely means to the everyday person out there once you read through the mumbo jumbo and take into account the "Spanish" take on things,

Fadesa wants approval of the liquidators - Likely to mean there is some shuffling to be done with respect to what is where on the finance front, and we have a lot of shredding to do.

Chairman of the company declared personal bankruptcy - Well as much as we don't enjoy kicking someone when they are down, but this could well mean that he knew it was coming, I mean how many billions in debt do you really need to be before the penny drops? Protection of personal assets is likely to be what that is about.

A few days more - Anyone who has lived in Spain has come across the word manana. Contrary to popular belief, it does not mean tomorrow, it means not today. It doesn't state when, just not today. If this is the literal translation of what has been said, then it will be a lot more than a few days before the CNMV get their papers!

Do note though, whilst all this is going on, Fadesa Maroc is still OK as far as we are aware, see our last post about the Morroccan arm of the company.

The second company with major interest is Colonial, they are off for a meeting with shareholders and creditors according to Reuters to have a chat about the possibility of a debt restructuring deal worth 8.9 Billion Euro, a right old tea party by the sounds of it with several major players involved, including RBS (Royal Bank of Scotland) who's shares closed down 3.51% on Friday.

There are others involved in the talks, the likes of Goldman Sachs, as well as Banco Popular and La Caixa, which earned the equity after swapping some debt earlier this year. Some earning that was eh guys!

These two developers will not be the last, Colonial is making the best efforts possible to avoid liquidation, but this isn't likely to disappear over night unfortunately, after the developer bankruptcies, the agents will follow. Some are already in that particular cauldron steeping as we speak, Viva Estates, Ocean Estates, and Red Hot Homes for example. From what we hear, it is sadly unlikely that any will recover.

Having said all that, perhaps it is what the industry needs, a healthy cull within a much hyped business, where almost any Tom, Dick or Harry can set up shop and develop away, or flog houses to unsuspecting people, playing on the "left my brain at the airport" syndrome.

We are researching in depth into the number of developers and agents in main areas of Spain at present that have gone out of business in the past 6 months, and the results are staggering so far, rest assured we will post the report when we are done, and what you can do if you have been affected.