Real Estate Fraud Surging
Alarmingly, recent reports point to a spiralling increase in real estate scams in Pakistan. The latest wave of real estate fraud involves the scammer taking photos and information from a current real estate listing duplicating this and using it to to make a fraudulent rental listing. Because the listing is usually priced below the market average price the scammers net is cast wide and even if one person is caught out the fraud has been a success.
The scammer creates a fictitious email address using the homeowner’s name which can be found easily through a public record source. The listing is usually placed on websites like Craigslist or similar less regulated property platforms. “Due to the stark increase in property related crime using reputable online companies is the best way to protect yourself,” says Saad Arshed—founder of Lamudi Pakistan . Pointing to the increased risks of online property searching, Arshed added that byusing a recognised company you can be assured that all agents and sellers are thoroughly vetted.
Moreover, there are other means to protect yourself from falling victim to a fraud. One is meeting the seller in person. One red flag that should sound alarm bells is if the owner is overseas on ‘business’ or has no time to meet due to ongoing excuses. In many cases the seller will ask for a security deposit prior to renting or viewing the property. Other red flags to add to your list should be the seller requesting personal information, and not being allowed to tour the home.
In addition, you can be safe by giving token money to finalize the deal. An amount of between 50k rupees to 1 Lac is enough to bind both parties. After, ask your agent to verify the allotment or transfer letter. Go to the society’s office and cross check its status. Another important point is to avoid paying in cash. While some dealers may offer cash discounts it bears too much risk. Bank orders are more secure and are better suited to property purchases.
There are many other scams that consumers should be aware of ranging from title fraud (identity theft with an illegal transfer) to property investment seminars (with sham experts and charlatans). In brief, as the property market goes digital consumers need to remain vigilant of possible fraud attempts. By bearing in mind potential red flag criteria, and by using respected online property platforms you can minimise the potential risk.