The internet provides a convenient marketplace where renters and property owners can connect. It’s easier now than ever before to find a dream apartment in your price range. Or to reach a broad scope of prospective tenants with a few clicks of your mouse. The COVID-19 pandemic has moved the focus even more firmly onto online marketing and video touring. Many of these shifts will likely become permanent. These changes have offered convenience and safety for tenants and landlords alike.
The drawback of this interconnected era is that it’s also much easier for people to spread or fall victim to fraud. With the housing and rental markets growing ever more competitive, lease fraud continues to rise. These schemes prey on renters by using fake rental listings to trick potential tenants into putting down money on fees, deposits, or rents for a property that the scammer doesn’t own. One scam was so elaborate that a couple moved into a house only to find out that their lease was illegitimate.
Lease fraud is a scary prospect for tenants and landlords alike. No tenant wants to become the victim of a scam. Because when tenants are nervous, they might hesitate before applying for your property. At the end of the day, scams hurt everyone. We want to give tenants and property managers the tools to identify and avoid these fake listings. Once you know the signs, you can protect yourself from the dangers of lease fraud.
Common Types Of Lease Fraud
Though there are many different ways that people prey on prospective tenants, the main types of lease fraud fit into a few general categories.
An Advertisement for a Property the Scammer Doesn’t Own
This common type of lease fraud involves posting pictures of a real rental property and collecting deposits from potential tenants looking to move in. The only problem is, the would-be landlord doesn’t own the property. Then, they quickly disappear with the “deposit” before the prospective tenants can uncover the truth.
A Listing for a Different Property Than the One Pictured
In this scam, a person does own a rental property. It’s just not the glamorous, professionally-staged apartment shown in the online listing. In this case, tenants can quickly figure out that the property owner hasn’t been marketing their rental honestly. But for renters who are moving in sight-unseen or unable to tour the property in advance, this can lead to a nasty surprise on move-in day.
A Home with Fabricated Amenities.
As long as a property owner can get tenants to sign a lease without noticing that the private community pool mentioned online is nowhere in sight, these scammers will be satisfied. Once the lease is signed, there’s little recourse for a tenant who realizes that the advertisement was inaccurate other than moving out after the lease expires or breaking the lease and incurring penalties.
An Expensive Background Check or Application Fee
It’s common for a landlord to require an application fee and perform a background check on a prospective tenant. However, if these fees seem exorbitant (generally more than 60 dollars), they may not be legitimate.
A scam artist will use text and photos from a real listing to lure in prospective renters in many of these schemes. Because scam artists copy as much information from legitimate listings as possible, these scams can be challenging to identify. As a prospective tenant, be diligent about verifying that a listing is real. Unfortunately, if a gorgeous rental home at a below-market price seems too good to be true, it probably is.
Spot the Warning Signs
Lease fraud thrives in competitive markets where prospective tenants are eager to jump on good deals. In a rental market that demands people move fast or lose out, scammers can leverage that sense of urgency to extort money from tenants eager to believe they’re getting a bargain on rent.
To start, don’t assume that any listing is legitimate unless it originated from a trusted real estate agent or property manager. Scams are most common on sites that allow people to post their own property listings. So, it helps to treat ads on Craigslist with an extra degree of caution. Be wary of listings that only have photos of a house from the outside or duplicate listings with the same pictures and text.
One of the most important things you can do to avoid getting scammed is to ask lots of questions. Do your due diligence before signing a lease or putting up any money. Any legitimate landlord should be happy to answer your questions. If the person claiming to own the property is evasive, uncommunicative, or otherwise avoiding your questions, that’s either a sign they’re a scammer — or not a diligent property manager.
With housing prices on the rise and the prospect of finding the perfect rental more fraught with difficulties by the day, many renters might benefit from cutting out the possibility of lease fraud whatsoever. In those cases, a property management company can provide the answer.
A Property Management Company Removes The Uncertainty
As a property owner, it’s impossible to avoid images of your property ending up in a fake listing. What you can do, however, is work with a property management company. When you list your property with a trusted third party, renters can trust that your listing is legitimate.
Without a property management company’s expertise, it can be easy to create a listing that renters might find suspicious. Hitting the sweet spot of the perfect rental pricing is a feat that takes hours of research and years of experience. Many fledgling landlords will price their property too low. Not only does this mean you lose out on potential profits, but a suspiciously low price on an otherwise attractive rental can be a red flag for diligent tenants trying to avoid scams.
At Rent Portland Homes by Darla Andrew, we bring years of experience in the Portland rental market to the table. Our team crafts professional listings across multiple platforms, always priced right. We grant prospective tenants the security of knowing they don’t have to stay on their guard and be on the lookout for scams. We handle all tenant interactions, from screening to rent collection to maintenance. With a property management company like Rent Portland Homes by Darla Andrew, you’ll be taking your rental to the next level of professionalism. If you have any questions about our free rental evaluation or all we can do to make your rental shine, call or text us at (503) 515-3170 or reach out over our website’s contact form.