When no one calls to see a vacant listing for awhile, some agents don’t bother stopping by. This can be the result: [Thanks L!]
A recent scam reported in the Phoenix area involves tenants moving into a pending short sale listing. The surprised listing agent contacted the owner who had not rented the property to anyone. The tenants (two women with two children) were physically moving in and had turned on utilities in their name. The sign and the lock box were removed, and all locks were re-keyed.
The tenants responded to a "For Rent" sign in the yard. They gave someone $1,800 as rent and signed a lease. While the short sale was able to close, the unfortunate victims of this scam were out $1,800 with no place to live.
This down economy encourages some people to take advantage of others. Listing agents should check their vacant listings regularly and provide neighbors their contact information in case they observe any suspicious activity.
If you own a place like this, you might want to follow the same advice. It wouldn’t hurt to let neighbors know what you are planning to do with the house and leave a phone number- that way when the sign changes from "For Sale" to "For Rent" without your knowledge, [And your agent doesn't know about it.] someone can let you know.
Recall that part of my post on Constructive Foreclosure was a point about Adverse Possession. I don’t necessarily see this development as a bad thing. The Common Law limitation period on quieting title to real property was 20 years. States like California have reduced that to 5 years, but also require that an adverse possessor pay the taxes on the property. Such revision in the law encourages putting property to use instead of letting it decay and become a blight. If it were reduced to say, 3 years, then there may be a lot of people out there already who could pay off tax arrears and own property. Even if it didn’t happen very often, it would certainly encourage reluctant property owners of record to exercise diligence in property management and maintenance.