In recent years, rental scams have become a significant concern for those seeking housing. In 2023 alone, approximately 9,521 real estate fraud complaints were filed, leading to more than $145 million in losses. The Federal Bureau of Investigation reported these alarming figures, highlighting the growing threat in the rental market. Understanding the tactics used by scammers and recognizing red flags can help prospective renters protect themselves from falling victim to such schemes.
Rental listing scams often involve fraudulent listings that either do not exist or are unavailable for rent. Scammers typically demand payments for application fees, security deposits, or the first month's rent, despite having no legitimate property to offer. According to the Federal Trade Commission, these scams are meticulously crafted to deceive unsuspecting renters.
The median monthly rent in December stood at $1,373, as reported by Apartment List. However, when rental listings are priced unusually low compared to similar properties in the area, it should raise suspicions. John Breyault, an expert in fraud prevention, warns that "the reason scammers put listings like that up is because they know that it will attract a lot of eyeballs and potential victims." Such listings are designed to lure individuals who may be drawn to the seemingly great deal.
Prospective tenants should exercise caution if a landlord or listing agent provides excuses for not being able to meet in person or show the property. John Breyault emphasizes that this behavior should be considered a significant red flag. Tracy Kitten Goldberg further advises that one should always meet these individuals face-to-face before completing any paperwork. Touring the property is crucial in confirming its legitimacy. "You should always meet these people face-to-face before you fill out any kind of paperwork," she asserts.
If either meeting the landlord or touring the property proves impossible, Tracy Kitten Goldberg recommends deleting the listing immediately. Breyault concurs, stating that this step is "really the litmus test to find out if an apartment is for real or not."
Scammers frequently employ tactics that create a sense of urgency, pressuring potential renters to make payments swiftly. Common demands include sending application fees or the first month's rent via wire transfer, gift cards, or cryptocurrency. According to Breyault, such requests are "a huge red flag," as they often result in the scammer disappearing once payment is received.
In 2022, real estate fraud affected 11,727 victims and resulted in over $396 million in losses. The figure underscores the prevalence and financial impact of these scams. A separate report by Rently found that 62% of respondents who experienced a rental scam lost more than $500, with 48% losing over $1,000.
The dark web's availability of personal information, such as cell phone numbers and emails due to recent data breaches, further complicates matters. Scammers exploit this information to target potential victims more effectively. Tracy Kitten Goldberg highlights that personal details are readily accessible online, making it imperative for individuals to remain vigilant when engaging with rental listings.
Fraud experts caution that scams often follow news trends and natural disasters. This tendency allows scammers to exploit situations where people may be desperate for housing solutions or other forms of assistance. As John Breyault notes, "Fraud tends to follow the news and tends to follow natural disasters in many ways."