Some simple precautions to avoid becoming the victim of rental fraud
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Recent data from the National Fraud Intelligence Bureau has revealed a worrying increase in rental fraud cases!
With reports of around 5,000 separate incidents reported in 2024, with tenants losing nearly £9 million in total, writes Phil Cooper, Partner.
The most common type of rental scam is advertising a property which doesn’t exist – often using descriptions and images of a real property – and then tricking prospective tenants into paying up-front fees, security deposits, advance rents and so on.
Where there is fierce competition for rental properties, potential tenants can sometimes be tempted into making rash decisions out of desperation; fraudsters know this and take advantage. However difficult you may be finding it to secure a rental home, you should always take basic precautions to avoid being ripped off.
The most obvious safeguard is never to agree to a tenancy without actually having seen the property itself. Doing so will foil the majority of rental fraud attempts, but even this is not foolproof. There are documented cases of criminals taking on a tenancy and then using that property to lure victims by pretending to sub-let it.
In the end, the best way of avoiding being scammed is to use a letting agent to find a new home. Agents are obliged by law to do a whole host of checks to verify ownership, including anti-money laundering protocols, which are designed to ensure that the prospective landlord has genuine title over the property and is therefore, subject to any other applicable consents or covenants, entitled to rent it out.
In the extremely unlikely event of something going wrong even after such checks have been conducted, it is the agent not the tenant who will have to carry the can for any money which is lost to fraud – an important safeguard.
Other simple precautions include avoiding making any kind of payments until viewing the properties in person, avoiding deals which seem too good to be true, and resisting attempts by prospective landlords to hurry you into a decision. Advertisements with no photos, or multiple ads with the same photos, should also raise a red flag.
Around 4.2 million deposits were registered with the Tenancy Deposit Protection Scheme in 2024, so the estimated 5,000 cases of rental fraud is a very small number in comparison. But if you are one of those who has fallen victim to such a crime, you can end up both significantly out of pocket and without anywhere to live, so it pays to be vigilant.
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