The Real Estate industry has benefited greatly from technological advances on the one side, but on the other side it has also made it easier for scammers to prey on unsuspecting buyers, sellers, landlords, tenants and agents.
Steve van Wyk, MD of Seeff Centurion, lists the below precautions with regards to sales and rentals to minimise the risks of falling victim to real estate fraud in either category.
With regard to rentals:
Van Wyk says the below red lights should not be ignored when it comes to rentals:
- When a landlord or agent asks for a non-refundable deposit to secure the property even before you as the tenant have viewed it or before the agent/landlord have met you.
- When they keep cancelling show days. Consider whether there is even a property to show.
- When the rental rate seems too good to be true.
- When the agent/landlord keeps stalling/ignoring you or not getting back to you within a reasonable time frame.
- When you are put under pressure to pay a deposit or to fill out paperwork before the required procedures have been followed. If an agent or landlord tells you that it’s not necessary to check your credit score or -
- When you can’t find any information on the “agent” on the internet or when the agent does not provide an office number and email address in addition to their cell phone number.
- When an Internet search shows that the agent has been reported for doubtful dealings in the past.
- When you can’t find info on the real estate agency online or their website seems amateurish.
- When you call the agency that the estate agent claims to work with and either they don’t know who the agent is or the agent does not work there anymore. The status of both the Estate Agent and Estate Agency can be checked on www.eaab.org.za
- When the agent cannot produce a valid Fidelity Fund Certificate.
Van Wyk adds that he also advises people who know that they will be seeking rental accommodation to start looking for rentals timeously as to avoid becoming desperate.
“Desperation may lead to hasty decisions and unnecessary shortcuts or may force you to settle for a place that you either don’t like or can’t afford”.
With regard to sales:
Outlined below are some pointers that should raise red flags when considering a sale:
- When the selling price is too good to be true. No seller would want sell their property for less than market value.
- When the agent or seller does not want to disclose their location of offices or when they are of no fixed abode.
- When the agent/seller goes AWOL on request of paperwork of the property in question.
- Inconsistency in the paperwork i.e. land size, description, registered owners etc.
- When a seller demands that funds to be deposited directly into their account without the involvement of a reputable lawyer or agent to handle the transaction.
- When immense pressure is put on the buyer to sign an agreement of sale and to pay a deposit as soon as possible.
- When the purchaser is a cash buyer but cannot provide proof of the cash.
- When a title deed search of the property shows another person as being the registered owner.
- When the buyer insists on taking occupation before any deposit has been paid or a bond has been granted.