Investigators: Rental scams rampant in hot housing market
MEMPHIS, Tenn. (WMC) - New data shows Memphis needs more than 30,000 additional rental units in order to house all the people who need affordable places to live.
Lack of inventory coupled with the COVID-19 pandemic has put a strain on the housing market and many renters are falling prey to scammers.
Donna Boyce was looking for a new place to live and thought she’d found a house for $500 per month on Facebook Marketplace.
“When you saw a house for $500, what were you thinking?” asked the Investigators.
“I had done hit jackpot,” said Boyce. “I felt I had been blessed.”
Boyce contacted the person on Facebook who told her she could see the house the following day.
“It had nice hardwood, clean shiny floors. I was just overwhelmed with it,” she said.
Boyce was sold even though the “owner” said he couldn’t meet in person.
“It was due to COVID the reason why we weren’t meeting in person,” said Boyce.
Boyce received a lease agreement and immediately transferred first month’s rent and a security deposit: $1,100 total. But she didn’t send it to the person who identified as the owner. She sent it to a woman.
“Sending my money through the phone like that and I’ve never met you, I had a funny feeling,” said Boyce.
She was supposed to meet at the house the next day where the owner would have her keys.
“So, that morning came. I woke up and I’m excited. I’m excited to go get my key. So, I call and his number was disconnected,” Boyce explained.
The listing on Facebook had disappeared and Boyce was out all that money.
There are nearly 50,000 low-income renters in Memphis, but fewer than 20,000 affordable and available rental units, according to the National Low Income Housing Coalition.
“There were a lot of people displaced during COVID-19,” said Nancy Crawford Butcher with the Mid-South Better Business Bureau. “We know that people are looking for affordable housing.”
According to Butcher, the Mid-South BBB has received six rental scam reports with a loss of more than $1,800 so far this year. However, Butcher said many more scams go unreported.
“How common are housing rental scams right now?” asked the Investigators.
“They’re very common. People are posting pictures of houses they don’t own. It’s always such a great deal that you have to put the deposit down right away. You don’t want to lose this great property and they want the money quickly,” she said.
Each report can be found in the BBB’s Scam Tracker tool, which allows consumers to search by region or scam type to learn what scammers are trying to pull in their area.
One of those scams in the online tool shows a fake homeowner wanted a deposit the day he sent a renter to three different addresses because she “couldn’t get in the first two” houses.
This would-be renter didn’t transfer any money.
Butcher says finding a home is emotional, which makes the search rife with scams.
“You’re buying into seeing your family living in that home and it becomes personal to you. It’s an emotional issue and the scammers know that,” she said.
Meanwhile, Boyce tried to dispute the money transfer with her bank but was unsuccessful.
“I think I cried for a whole week. I just cried,” said Boyce.
To avoid rental scams, the BBB says do not send money to anyone you haven’t met in person.
Try to find the owner of the property you’re looking at by typing the address into the property assessor’s real property search tool.
Be suspicious if you cannot get into the property or if the property is listed well below market value.
Copyright 2021 WMC. All rights reserved.