Common Rental Housing Scams and How to Avoid Them

September 7, 2018 | by Michael Wilt

Categories: Rental Housing

An estimated 5.2 million Americans have lost money on a rental scam, and far more have come across fake listings or even fake properties while searching for an apartment. That's according to a recent Apartment List study that offers an in-depth look at a pervasive type of fraud rarely talked about. 

What's more startling is how much these renters are losing. The median loss is $400, but 17.6 percent lost between $500 and $1,000, and almost a third lost more than $1,000. 

Rental scams come in many varieties, but Apartment List highlights these five most common ones:

• Bait-and-Switch: A different property is advertised than the available rental, and the scammer tries to collect a deposit or get a lease signed for the different property.
• Phantom Rentals: A scam artist makes up listings for places that don’t exist or aren’t rentals and tries to lure renters with low prices.
• Hijacked Ads: A fake landlord posts advertisements for a real property with altered contact information. Homes for sale are often re-listed as rentals in this type of fraud.
• Missing Amenities: A real rental is listed as having features and amenities it lacks (most commonly laundry) in order to collect a higher rent. The leasing agent tries to get renters to sign the lease before they notice the missing amenities.
• Already Leased: A real or fake landlord attempts to collect application fees or security deposits for a rental that is already leased.

So, what can you do to avoid these scams?

Apartment List offers some tips, as do Rentberry and Trulia. We compiled our favorites based upon their recommendations.

• Always visit the property in person. This is the best way to ensure the property actually exists and accurately meets its description in a listing. You will also want to visit the landlord or a property manager on site. If you are relocating, ask a trusted friend or family member in that city to visit the property for you.
• Never pay an application fee or security deposit in cash. Scammers will commonly ask for cash because those transactions don't leave a paper trail. If possible, pay with a credit card, check or some other way that allows you to track the method of payment, delivery and receipt.
• Do your homework. Find out as much information as you can about the landlord and/or property manager to make sure they are reputable and if there have been past compliants or grievances filed against them. Also, talk to current tentants to get their feedback on how the property is managed.  
• Protect your confidential information. Don't provide sensitive information like a social security number or bank account number until you have verified the legitimacy of the property and landlord/property manager. Even if you don't lose money in a scam, you're still at risk of identity theft.

If you're the victim of rental fraud or a scam, thespruce.com offers advice on what to do. 

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On the House blog posts are meant to provide general information on various housing-related issues, research and programs. We are not liable for any errors or inaccuracies in the information provided by blog sources. Furthermore, this blog is not legal advice and should not be used as a substitute for legal advice from a licensed professional attorney.