A staggering 43 percent renters say they’ve come across online rental listings that could be fraudulent, while a seemingly improbable five million say they’ve actually been scammed, according to a new study by ApartmentList.
ApartmentList, which is one of the biggest online rental listings sites in the U.S., said that some of these renters have been scammed for “thousands of dollars”, and warns that people need to be extremely diligent when looking for a place to live.
Many renters are not as cautious as they should be when they’re in a hurry to find a new place to rent, for whatever reason that may be, Igor Popov, chief economist at ApartmentList, told CNBC. As a result, they can be easy victims for smart and experienced scammers, he said.
““There are lots of cases where there’s a lot of urgency in the rental market, especially in some of the really supply-concerned markets that are out there, where you have 10 renters fighting for one available apartment,” Popov said. “In reality, there’s a lot of urgency, and I think scammers can also sometimes prey on this.”
The most common scam that renters come across is called the “bait and switch”, in which a different property from the one that’s actually available is advertised. The scammer attempts to get the renter to sign a lease on the property before they actually visit it, and will also attempt to collect a deposit at the same time. This deposit won’t be returned once the victim realizes the property is not what they thought it would be.
A second popular scam is called the “hijacked ad”. This involves the scammer posing as the ‘landlord’ of a home that has actually been listed for sale, in order to try and collect rent on it. A third scam involves posting a listing of a property that’s already occupied. The scammer than attempts to collect application fees or security deposits from unsuspecting renters.
“I think what really surprised us was just the prevalence of the different variety of scams out there,” Popov said. “It is surprising how many people have fallen for these types of scams. Over 5.2 million renters out there have either put down an application fee, or a security deposit, or maybe even first month’s rent, usually sight unseen.”