{"id":5761,"date":"2023-02-06T15:48:46","date_gmt":"2023-02-06T22:48:46","guid":{"rendered":"https:\/\/www.realtyexecutives.com\/blog\/?p=5761"},"modified":"2023-02-06T15:48:47","modified_gmt":"2023-02-06T22:48:47","slug":"real-estate-scams-trending-in-the-digital-sphere","status":"publish","type":"post","link":"https:\/\/www.realtyexecutives.com\/blog\/real-estate-scams-trending-in-the-digital-sphere","title":{"rendered":"Real Estate Scams Trending in the Digital Sphere"},"content":{"rendered":"\n
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Real estate scams cost buyers, renters, and landlords billions of dollars annually. The transition to digital real estate solutions and a rampant housing market resulting from the COVID-19 pandemic has seen them increase more than ever before. <\/p>\n\n\n\n

You should be mindful of these four real estate scams currently trending in the digital sphere, from wire fraud schemes<\/a> to phony home and apartment listings. <\/p>\n\n\n\n\n\n\n\n

1. Closing Wire Fraud<\/h2>\n\n\n\n

Buying a house is equally exciting and\nnerve-wracking whether you’re a first-time buyer or someone constantly on the\nmove. Imagine the stress when a transaction is nearly completed and the closing\nfunds suddenly vanish.<\/p>\n\n\n\n

According to the Federal Bureau of\nInvestigation’s (FBI) 2021 Internet Crime Report, wire fraud accounted for $350 million in losses from real estate<\/a> investments and closing funds in the United States. However, only 12%-15% of these situations<\/a> were reported, with victims losing an average of $100,000 last year.<\/p>\n\n\n\n

Real estate transaction schemes are a\npopular tactic for hackers to scam homebuyers, often impacting closing and\ntitle companies the most. The scammer hacks inboxes looking for a pending\ntransaction, then creates a legitimate-looking email address as a credible\nalias. <\/p>\n\n\n\n

They use the email address to send the\nbuyer wiring instructions for a down payment, mortgage or final closing costs<\/a>, which are funneled into the scammer’s accounts instead. Buyers often\nlose hundreds of thousands of dollars they will likely never recoup. <\/p>\n\n\n\n

Wire fraud scams gravely impact buyers, sellers,\nand the entire real estate industry. Clear communication between all parties\nregarding wiring money is the only preventive measure to avert these digital\nreal estate scams. <\/p>\n\n\n\n

2. Timeshare Resales<\/h2>\n\n\n\n

The American Resort Development Association\n(ARDA) estimates that 9.9 million U.S. households own a timeshare<\/a> \u2014 many of whom probably signed up excitedly while on vacation\nthemselves.<\/p>\n\n\n\n

Timeshares appear to be a fantastic\nopportunity at first, but they typically prove burdensome. Buyers often get trapped after overlooking essential provisions<\/a> regarding the right of refusal, survivorship, and continuity within\nthe never-ending pages of the contract.<\/p>\n\n\n\n

As if the initial timeshare signup wasn’t\ndishonest enough, resale scams are also gaining traction. For example, scammers\ncall timeshare owners pretending to be real estate agents with an interested\nbuyer.<\/p>\n\n\n\n

They might use real names, personal\ndetails, business phone numbers and, sometimes even professional websites and\npaperwork to appear credible. Once they’ve convinced you to sell your\ntimeshare, they’ll ask for you to wire the money upfront. You’ll likely have\nlost a large sum of money by the time you realize the buyer and sale were fake.\n<\/p>\n\n\n\n

The Federal Trade Commission (FTC) reminds\nsellers to contact their timeshare management company or developer directly and\nlook out for callers who promise<\/a> fast transactions, several interested buyers, and guaranteed returns\non the unit.<\/p>\n\n\n\n

3. Phantom Rental Listings<\/h2>\n\n\n\n

There were about 6.12 million existing-home sales<\/a> in the U.S. in 2021, a historic high not seen since 2006. However,\nwith the increase in properties hitting the white-hot real estate market, an\nuptick in online phantom listings has surfaced \u2014 especially in the rental\nsphere. <\/p>\n\n\n\n

Consumer credit reporting agency TransUnion\ndetected a 30% rise in rental fraud<\/a> from March to August 2020, including many fake tenant identities and\nlistings.<\/p>\n\n\n\n

Craigslist is a hot spot for fraudulent\nrental listings. It’s possible to find a great deal on an updated apartment in\na safe neighborhood, but Craigslist hosts many scammers eager to take advantage\nof prospective renters. <\/p>\n\n\n\n

Scammers will search reputable listing\nsites \u2014 such as Zillow and Trulia \u2014 collecting photos, descriptions, and other\nessential details. They’ll create a fake rental listing on Craigslist using the\nstolen pictures and captions, pricing the unit below market value. <\/p>\n\n\n\n

Renters then contact the scammers thinking\nthey’ll get a good deal, often putting a placeholder deposit down without ever\nseeing the unit in question. The scammer clears the funds only for the renter\nto find out the listing was a hoax. <\/p>\n\n\n\n

Whether you’re buying or renting, if a\nlisting looks too good to be true, it probably is. <\/p>\n\n\n\n

4. Short-Term Rentals Payments<\/h2>\n\n\n\n

Short-term rentals from Airbnb and VRBO\nhave grown in popularity throughout the last few years. Short-term rental\nbookings are becoming more common as the world reopens from COVID-19, with\npeople looking to travel again. However, property managers and guests are at a\nheightened risk of being targeted by various scams.<\/p>\n\n\n\n

The most typical short-term rental scam has\nto do with transactions. Scammers might ask Airbnb users to pay a security\ndeposit or for a booking outside the platform by check or a third-party app.\nThey often persuade renters with the promise of a beautiful rental at a\ndiscounted rate. A similar scenario happens to the property managers and owners\nwho fall victim to phone scams from interested Airbnb and VRBO users.<\/p>\n\n\n\n

People reserving a short-term rental should\nconduct all bookings, communication, and payments through the official\nplatform. <\/p>\n\n\n\n

Avoid Falling Victim to Digital Real Estate Scams<\/h2>\n\n\n\n

Technology has reshaped the real estate\nindustry, making it easier to perform marketing and sales tasks. However, while\nonline wire transfers are faster and property listings can reach broader\naudiences, real estate professionals, buyers, sellers, and renters must be\nvigilant and protect themselves from digital scams.<\/p>\n\n\n\n

\n\n\n\n

About the author:<\/strong> Evelyn Long is the editor-in-chief of Renovated<\/a>, an online resource for the real estate market. Her freelance writing has been published by the National Association of REALTORS\u00ae, Insights for Professionals and other prominent industry magazines.<\/p>\n","protected":false},"excerpt":{"rendered":"

Real estate scams cost buyers, renters, and landlords billions of dollars annually. The transition to digital real estate solutions and a rampant housing market resulting from the COVID-19 pandemic has seen them increase more than ever before. You should be mindful of these four real estate scams currently trending in the digital sphere, from wire … Continue reading Real Estate Scams Trending in the Digital Sphere<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[25,6205,835,285],"tags":[281,59,1163],"yst_prominent_words":[7057,904,7060,7059,7049,903,1902,7044,2366,3390,796,1897,7043,1542,7054,7045,7056,7058,7047,7046],"_links":{"self":[{"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/posts\/5761"}],"collection":[{"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/comments?post=5761"}],"version-history":[{"count":1,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/posts\/5761\/revisions"}],"predecessor-version":[{"id":5763,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/posts\/5761\/revisions\/5763"}],"wp:attachment":[{"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/media?parent=5761"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/categories?post=5761"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/tags?post=5761"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.realtyexecutives.com\/blog\/wp-json\/wp\/v2\/yst_prominent_words?post=5761"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}