Buyer Beware.

In today's world of corporations ripping off their loyal customers to support their own "yacht club lifestyles," it's hard to ignore a consumer-fueled resource like Craig's List. For those of you who don't know what Craig's List is, (and really, if you don't know, pop your bubble and explore the world a little bit) it's a web site in which anyone can post any service/product they have to offer. Services offered on the site range from car sales, to job applications, to real estate, to sex solicitation. Really, anything. While there is some regulation of what can/cannot be posted, it's minimal at best. I can see why some would argue that Craig's List is "creepy," and "unsafe." I don't disagree. I mean, given the amount of scandal associated with the web site I can't disagree. However, I'm a strong proponent of people bartering on their own behalf's and being in full control of their negotiations (How strange given my profession, right?). It's your money, and you should be able to do with it what you please. I, personally, have rented an apartment via Craig's List. However, I'm a licensed agent. If you lack the knowledge of what you're trying to buy/sell, it's imperative that you enlist the help of a professional. I say this from the overwhelming experience of speaking with hundreds (seriously) of people who have tried to buy/rent a home via a self-bartering web site, and have gotten royally screwed. I get at least two phone calls per day from someone asking me if a Craig's List post is a "real" listing. 99.9% of the time , it's not. You know the saying "If it's too good to be true, it's probably not true?" Well, apply that here. If you think you found a 3bdr/3bath on Park Ave for $1,900 per month, sadly, you thought wrong.

This topic has been brewing in my head for some time, but after a really over the top experience I had today, I felt compelled to impart some knowledge on all of you. I spoke to a woman this afternoon who was asking me about a property that she was already "renting." I sarcastically use the term renting because she paid two years up front, and hasn't been allowed in the home yet. She told me the lease has (according to her "landlord") been on the kitchen counter inside the house for three months, but they haven't been able to get into the property because of an "alarm code issue." Believe me when I tell you, I know this sounds ridiculous and I almost hung up on her. After some poking and prodding, she told me that the landlord lives in Dubai, she lives in England, the property is in The Hamptons, and they found the property online. She also told me that they mailed the required monies directly to the landlord and do not know his full name. At this point, I wasn't sure what was going on, but I knew that someone had taken advantage of her. Naturally, my next question was regarding the amount of money that actually changed hands. She said, "$5,000,000." I almost choked on my gum. Even I, having a lot of real estate fraud experience, couldn't believe what I was hearing. I triple-checked that I had the amount right, tried to rationalize why someone would send that amount of money to stranger, and then decided to continue listening to her. She casually stated that the rental equaled 2.5 Million per year. It was supposedly a fully-furnished home, filled with amenities such as a personal chef, and maid staff. Out of a combination of curiosity, horror and pity, I pulled up the property's public record. Now, public records can sometimes be wrong, but the assessed property value is usually within a certain range from the actual market value. Meaning, it's relatively accurate. The house they were "renting" was most recently assessed for a sales value of $780,000. Also, there were no records of real estate transactions (buying, selling or renting) since 2006. At this point, I let her know my findings, but sadly couldn't do much else. Yes People, this ridiculous story actually happened. I know you're probably thinking "Well, that person's an idiot." Think about it though, they're not from the U.S., and have no real estate experience. They are the ultimate easy-target. While I personally don't spend over $50 without knowing exactly where it's going, I can't speak for other people. Sadly, things like this happen all the time. Just three days ago, I spoke to a college-aged student who was hoping to rent an apartment in Manhattan. After already sending her out-of-country landlord money and giving out her social security number, she called me. Again, the property didn't exist, and there was nothing I could do. Obviously, this situation is more common than the aforementioned one. Regardless, people are being played left and right.

Here are three signs that, I've come to find, point to a listing being a scam:

1. The first tell-tale sign of a fake listing is the price. If nothing else you've seen in the area is comparable price-wise, you need to question A. Is it "real?" and B. If it is real, what's wrong with it? A great web site to check out to find out more pricing info is streeteasy.com. I have access to every system out there, and I use streeteasy more than anything else. Granted, it has mostly Manhattan listings, but it's still a great resource that could end up saving you a ton of money. If you're on Long Island, I would highly recommend checking out MLSLI.com.

2. Another common theme in these bogus listings are foreign landlords. I'm not sure why, but almost all of these issues I've dealt with have had an international landlord attached to them. The most common are Dubai, and England. My guess, is that they're less traceable.

3. If you are immediately asked for your social security number, run. They do not need it. Unless you are working with a real estate agent, there is no reason to give out your personal identification number. A real estate agent would obviously use your social to run credit, but if an agent isn't involved, you should run the credit yourself. There are many web sites that do it for free, the most popular being freecreditreport.com (You know, the one with those annoying commercials). You will be able to produce the standard credit report on your own, while maintaining your privacy.


The moral of this is plain and simple: Buyer Beware. If you are going to enter into a deal on your own, make sure you've successfully covered your behind. If you don't, you have no one to blame but yourself. I'd also highly recommend having a lawyer involved. If you're unwilling to work with a real estate professional, at least have some type of legal representation backing you in case something goes wrong - and believe me, something will go wrong.