PORTLAND, Maine — This spring, realtor Mandy Wheeler pulled up to meet some folks who were interested in a short-term rental she listed on Craigslist.
She had recently helped a Seattle couple buy the single-family building a few weeks prior, and was now renting it out for them for six months as they prepared to move. She had listed the short-term rental on Craigslist, like usual, and it didn’t take long for her to find interested parties.
Immediately, she could tell something was out of whack.
Two people were already there looking around. Wheeler first assumed that they were the ones she’d scheduled, but they weren’t. The woman told Wheeler that the house’s owner had instructed them to check out the place and the neighborhood before sending a deposit to secure the rental.
That was impossible.
The house had just been sold, and the new owners’ names weren’t even in the public records yet. They wouldn’t be scheduling showings because they were already paying Wheeler, their realtor, to do exactly that. The name the woman gave Wheeler had some credibility, but it belonged to the house’s old owner.
“This scammer took my listing and was communicating with people pretending to be the old seller,” Wheeler said.
As Maine’s housing market has rocketed out of control, real estate brokers like Wheeler are getting a lot of business. But the feverish pitch of the housing market has given rise to a dark secondary market — the online rental housing scam.
“People are feeling … desperate,” Wheeler said. “They’re like, ‘I’ll just give you money right now to hold this spot because it looks like such a good deal, and I’ve been looking for months and I can’t get anything. It’s coming out of desperation and it’s so sad.”
Facing thick competition for affordable housing, many renters are quick to put down a deposit on a listing. But that has widened the threat of scammers, who prey on desperate renters and those who are willing to take on more risk. These hoaxes typically create an impression of a house, telling interested parties to send deposits through an online payment app.
Internet-savvy people can often spot a fake, but even that’s getting harder to do. Scammers tend to lift descriptions from other authentic listings, lending a whiff of legitimacy to fake rentals.
That day in Portland, it was up to Wheeler to tell the people she met outside the house that they were being scammed. In reality, the actual rent of the house wasn’t in their range. Wheeler had listed it at nearly double the monthly rate the scammer told them, framing the home as a too-good-to-be-true prospect that might have convinced them to make a deposit.
“People with language barriers are getting hit harder with this,” Wheeler said, noting that non-native English speakers and elderly people are at higher risk of being unable to spot fake listings.
The fast-paced real estate world can pose additional challenges beyond cost.
“When someone lists their property and gets hundreds of inquiries in 24 hours, someone who is not good at communicating and struggles with English has no shot,” Wheeler said. “Then they’re desperate, so they’re reaching out to scammers because scammers are the only people who will respond to them.”
And there’s little recourse to track scammers. Craigslist’s free, user-friendly platform makes it a go-to site for community listings like real estate, but can also leave it vulnerable to hoaxes. A Craiglist FAQ page warns users of the dangers of fraudulent listings, but scammers routinely find a way around their screening process, which can be at odds with their site’s ethos of low-barrier access.
The Portland Police Department doesn’t monitor rental scams unless there are multiple complaints. Most are traced internationally, and are forwarded to the Inspector General or the Secret Service. A spokesperson for the inspector general’s office said in early April that there had been no reports of rental scams in 2021.
But locally, real estate professionals tell a different story.
“It’s absolutely worse than it used to be,” said Randy Dee Farrell, a broker with Portside Realty Co. Farrell blames Craigslist for not doing enough to curb fake listings.
“Craigslist was always a good option for my clients that were looking to rent. But that was years ago. Now, I would never recommend anybody use Craigslist,” Farrell said. Though he dislikes Zillow’s fees and algorithm-based housing value estimates, the site is much harder to game and thus a better option.
Craigslist, the San Francisco-based classifieds company, did not reply to an inquiry.
The breathless pace of Maine’s housing market also likely has something to do with it. Last year, Wheeler would routinely bid $60,000 over the asking price on behalf of clients looking for homes in the greater Portland area. This spring, she’s been bidding as high as $200,000 over the asking price, and even that isn’t sealing the deal.
“It’s definitely tied into the fact that we have a rental shortage,” Farrell said, adding that fake listings are typically “smaller homes,” not million-dollar properties. “What’s so unfortunate is that the people they’re going after with these low rents are the people with the least amount of money and opportunity to find a rental.”
Farrell recently did some sleuthing to see what scammers were telling buyers. Posing as a potential renter, Farrell communicated with a scammer who pretended to be Farrell’s clients, whose names they gathered from public records. The scammer wanted down payment for a rental of a house that Farrell had recently sold, telling Farrell via email that they had a “horrible experience” with their agent and took the house off market to rent it on their own.
The experience was frustrating, Farrell said.
“That’s 30 consumers in my market that are being told that I’m a dishonest agent,” Farrell said.
The fake marketplace can also add a lot of extra work for realtors. Farrell recently fielded 30 phone calls about a fake listing, and more time flagging the posts for removal on Craigslist.
As people flock to Maine from out of state and others seek new housing after a year in lockdown, Wheeler urges people to slow down and establish some trust before jumping into a new housing situation.
“Don’t ever give people money over the Internet to them without meeting them and going inside the property first,” she said.