According to this article on Shelter.org, a quarter of a million people have fallen fall victim to rental fraud in the last five years.
But what’s more worrying is that they believe most instances of rental fraud go unreported to the police, so the figure is probably a lot higher.
So, let’s take a look at the most common scams and how you can avoid them!
Here’s a list of commonly known scams that tenants have fallen victim to:
1] Let and run
This by far the most common scam: when someone pretending to be a landlord or someone authorised (e.g. letting agent) shows a prospective tenant around a property.
When the prospective tenant looking at the property says they like it, the scammer asks them to pay an up-front holding deposit to reserve the property, and often the first months’ rent.
The prospective tenant pays the sum (which can be several hundred pounds or more), but the landlord/agent then drives off into the sunset with the cash, never to be seen or heard from again.
Of course, the scam quickly unravels, but it’s too late.
2] No need for a deposit
In this delightful scenario, the landlord won’t ask for a deposit, he/she will instead request the details of a Tenant Guarantor. Then, when the Tenancy Agreement comes to an end, the guarantor will be held reliable for very expensive, and generally unnecessary repairs.
3] Unprotected deposits
Since 2007, landlords have been required to protect the deposits their tenants hand over into one of the three Government approved Tenancy Deposit Schemes.
The legislation was put into place because there were often disputes between landlords and their tenants about whether the deposit should be returned.
However, according to Shelter’s findings, many landlords are still avoiding complying with their legal requirements, and then keep hold of the deposit at the end of the tenancy for no good reason.
4] Subletting scam
This another common one, when a tenant sub-lets the entire property or individual rooms in the rental property without the landlords permission.
The person that is sub-letting (i.e. the original tenant) charges more rent than what they are paying for rent, so they make a profit each month.
Some tenants illegal sublet multiple properties and make a handsome living from it. Needless to say, the properties are generally in very poor condition and they generally exploit those sub-letting.
5] The overseas Landlord
These scams typically takes place on the internet, so the scammer doesn’t need to be present and may never have been to the actually property they are marketing for let.
The so-called “landlord” will advertise properties they don’t own on UK based websites and claim they’re an overseas landlord.
They get interested tenants to transfer a holding deposit into their foreign account, and then vanish into thin air. These people are virtually impossible to track down.
Don’t hand over any money before visiting the property in person or meeting someone that is authorised to let the property.
I’d be wary of dealing with any overseas landlord! Most legitimate overseas landlords will use letting agents to manage their properties, or entrust the management to a close family member. Either way, they’ll be local representation!
6] Nigerian Rental Scams
These Nigerian scams are classic and have been around for years. I think almost everyone with a email account would have received spam email from a “Nigerian Ambassador” at some point.
There are so many variations of this scam, I would just avoid any deals that involve an overseas Nigerian landlord trying to rent their property, or offering you huge sums of money.
Preventing Rental Scams
Here are a few ways that may help tenants avoid falling victim of rental scams:
- Ask the landlord for photo ID e.g. Driving License, Passport
- Ask for details of previous tenants for referencing
- Ensure the landlord is meeting all legal regulations. Genuine landlords will meet all legal requirements, in particular the Gas Safety Certificate and Tenancy Deposit Scheme
- Avoid paying any upfront fees without viewing the property and meeting the landlord at the actual property
Go to my Tenants Guide To Finding A Good Landlord for a more detailed safety precautions.
Have you been a victim? Do you have any other suggestions?
I’m just curious if anyone reading this has fallen victim to a rental scam? If so, what happened? Also, is anyone aware of any other rental scams commonly used to trap tenants? And finally, does anyone have any further tips on how to avoid rental scams?
Disclaimer: I'm just a landlord blogger; I'm 100% not qualified to give legal or financial advice. I'm a doofus. Any information I share is my unqualified opinion, and should never be construed as professional legal or financial advice. You should definitely get advice from a qualified professional for any legal or financial matters. For more information, please read my full disclaimer.
Thanks for posting--this saved me a lot of hassel. Looks like Denis Harrison, Daniel Howl, Theresa Barrett, and Mike Winnard are now John Kairis and leasing in Washington DC (and living in "Europe"). This person is really persistent in this shitty scam.
Email #1:
Sorry for the late reply. Most of the time, I work out of the country, in Europe. I bought the property in 2009 for my parents, who recently relocated in Corsica, France. Since I do not want to sell it, I decided put it on the market for long term rental. It is nice, clean, quiet, and you can move in immediately. It has all the necessary amenities such as cable TV, high-speed internet, air conditioning own washer and dryer, private parking. The monthly rent for my apartment is US $1080 and has about 916 sq feet. Well behaved pets are allowed.
How long would you like to rent it for?
Who do you rent for at the moment, a private landlord or estate agency?
Can you provide any references?
I'm looking for an honest tenant who would look after my property, keeping it tidy and in good condition. I had some bad tenants and now I have had the property completely refurbished. As you can see I am not after a high profit, but after good tenants who will treat my property as their own home.
Please kindly let me know as I foresee it might not stay on the market for long.
Kind Regards,
John Kairis
Email #2:
The address is 475 K St NW, Washington, DC.
I will gladly sign the contract with you if we can reach an agreement. As I explained in the previous email, I live in Europe. Unfortunately, I don't have any friends or other person back in United States who could arrange a viewing with you. In order to make the rental process easier for both of us, I would like to use Airbnb.com ( https://airbnb.com/trust) as they are currently managing my property.
They will require the first month’s rent US $1080 + one month holding deposit US $1080, meaning a total of US $2160 has to be deposited with Airbnb.
You will be contacted by Airbnb and will receive their payment details with the warranty for your deposit. After you make the payment deposit to Airbnb, you will be contacted by an Airbnb agent to agree on a suitable date and time to view the property.
Upon viewing the property, if you decide to rent it, the Airbnb agent will provide you with the rental contract which you can sign on the spot. If you decide to sign and move in, Airbnb will release the payment to my account 30 days after your move in date, all this time your money will stay with Airbnb.
If, however you decide not to rent it your one month’s rent payment+ deposit will be fully refunded, they won't charge you a penny.
In this way Airbnb will handle the money and the keys so as to ensure a smooth processing.
Please provide me with the following details for your referencing application so that I can register the transaction with Airbnb and move forward.
First name:
Last name:
Full Address:
Phone number (a valid mobile number where Airbnb can contact you):
Passport or National ID photo:
The Airbnb agent will require you to show the Passport or National ID in original when you move in.
The copy is needed in order to fill in your contract.
Let me know at your earliest convenience if you understand the process and I will contact Airbnb with your details.
Once I send them your name,address..etc they will register you in their database and contact you with the instructions for payment. Upon receipt of your payment, an Airbnb agent will arrange the viewing with you.
Kind Regards,
John Kairis