Rental Property Scams: 7 tips to avoid being scammed
With the internet and all our devices mobile now, it makes everything easy and convenient for us. However, with that comes those who want to take advantage of this convenience – the online Scammers, especially rental property scams.
In Property Management, online Scammer creates quite a challenge. These individuals find listings of properties for rent online, then post their own advertisement for the property, usually on Craigslist.
Over the last 30-years, here at Management One, we have had our fair share of run-ins with scammers and have seen a dramatic increase in the number of scams in the last decade.
I want to take the opportunity to share with you what to look for when renting a property and how to avoid being scammed out of thousands of dollars.
Rental Property Scams - Why do scammers scam?
The Scammer intends to collect application fees, security deposits, even rent for a month or two, if they think they can. In the end, they just take off with the money they were able to collect, unbeknownst to the applicants or renters. Disheartening and a significant setback for you as a prospective applicant as well as an issue for the property management company.
Scammers have been doing this for a long time though. Even when the Scammer cannot get into a property, they tell the potential renters that they are out of town, but they should drive by the home, even get out and walk around the property to see if they are interested. The Scammer will almost always offer them a great deal on rent.
Another great article to check out is "Renting from a Private Owner Versus Management Company"
Self-Showing Lockboxes
Now with the newer self-showing capabilities, such as Show-mojo and Rently, Scammers can work their magic on potential victims more than ever before. Typically, a Scammer that is focused on the self-showing properties starts with an online scam listing. They bring up the self-showing ability, so the Scammer seems credible. The Scammer will go online to get a code to access the property, then gives it out to potential renters. It is common for the scammer to claim they own the property. The renters let the scammer know they like the property leading to a transaction. Usually, the scammer will share a story of some kind, like they are firing the property management company (whose sign is still in front of the property) but go on their website to schedule a viewing of the property. Just contact the “landlord” afterward to do the paperwork since “they will no longer be working with the property management company.” So, the Scammer is actually using the showing system the property management company is using too.
Playing the game
Scammers are able to switch their methods quickly. Take the necessary steps to protect yourself and guard against this happening to you.
- Try to avoid a rental scam by looking for signs on the property that has the property management company name, contact number, and website information. Usually, you should be able to see the sign from the street. Call the company, look them up online as well as the ads they have for the property.
- Never send or wire money to anyone you have not had a chance to talk or meet with. If the landlord does meet you at the property, but there is an excuse you can’t get in to see it (he forgot keys, brought wrong keys, etc.) be cautious.
- If the landlord seems too eager to rent to you, be cautious. If you are told a lease is not required, don’t do it. When there is a lease, make sure it identifies the owner or property management company.
- Don’t leave an application with your personal information under the doormat or stuck to the garage door.
True Story #1: Never Pay for a Rental List
I recently had a prospective resident come into our office looking for a property from a reputable company. The resident shared this story with me…
The resident saw a property online that they really liked. They contacted and spoke with the “leasing agent”. They scheduled an appointment to look at the property even inside. They decide they like it and want to apply. The Leasing agent left an application folded up and stuck a little under the garage door for them to pick up. Then tells them when done, leave it back under the edge of garage door (as to not blow away) along with $180 application fees (cash of course) and believe or not….they did it. They left all of that and call the guy and he never answers after that. The resident recently drove by the property only to find out it is not for rent after all.
- Don’t ever pay for a list of homes for rent. There are companies out there that will charge $250 for a list of homes. These lists are usually accumulated by going online to sites such as Zillow and Trulia, finding homes that are for rent and then putting them on one list. The companies that do this normally don’t have the permission from the management companies to “sell” this data.
True Story #2: Craig's List is a Mecca for Scammers
A family finds a rental company with a lot of listings. They actually even meet at an office. They have to pay $250 for a rental listing, with a guarantee that they will get one of the homes. The family starts going through the list and going by the properties, only to find out the list has homes that have residents and the “company” does not manage. They go back to the office they met at, and the office is empty. They met several other families are at the location looking for the company too.
- Be cautious of ads on Craig’s list. We stopped placing properties for rent on Craig’s List because the number of scammers dramatically increased when we did this. It is very common for scammers to prey on individuals looking for homes for rent on Craig’s List.
True Story #3: Always See the Inside of the Home
Over the years we have experienced scammers copying our property ads. The new ad will have an unbelievable rental rate. We had one last year in Riverside. Rent was $1700. The new ad was for $800. I must have received over 100 calls each day for that property, it would seem when they first placed the ad they left our company phone number on the ad. They changed it to a different phone number in a few days. One lead said they did end up speaking to someone at the property who took their application, copy of their IDs and socials, along with a check for the application fee. They could stop payment the check, but now the scammer had their IDs and socials.
- Don’t apply for a property without seeing the inside. It is common for scammers to make excuses to not show the inside of the home. Such as “I am out of town”, “the current tenant isn’t available today” and more. What they are really saying is “I don’t have keys to this property”.
Don’t be a Victim
Always have your guard up, be overly cautious when applying for a rental property. If something seems too good to be true, then it probably is. We recommend going with a reputable management company. At the very least, if you are renting through a private owner, do your research first.
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