As you'll quickly learn, when it comes to New York City real estate, there’s a whole lot of demand and not a lot of inventory.
Unsurprisingly, this dynamic doesn’t work in your favor as a renter. Instead, it causes rising rents and competition for well-priced apartments. It also means there are plenty of scammers out there trying to take advantage of the fast-moving market. Knowing how to identify scams in the NYC market is crucial for your apartment search so you don’t end up throwing your money away, or without a place to live at the last minute. We delved into our own archives, and consulted with spokespeople at Streeteasy and Naked Apartments, to round up the most common scams plaguing this market. Renters beware:
[Note: This story originally posted in May 2016, and was updated in May 2017.]
Fake listings exist for a number of reasons, and you’ll find them littered all over Craigslist. One type is the “bait and switch": A real estate agent lists a seemingly great apartment but don’t have it available when you call, and ask to show you around to others. Other brokers will hold open houses, collect nonrefundable application fees, and vanish. So how to tell if a listing is fake? Do your research before you go see it, says Streeteasy spokesperson Lauren Riefflin.
“Look at the listing’s time on market. If the listing looks like it’s a good find, but has been sitting on the market for more than six weeks, your radar should start going off," she tells us. "Either there’s something really undesirable about the place that’s keeping it on the market, or it’s a stale listing.” If you’re searching on a website like Streeteasy, you’ll be able to easily tell how long the listing has been up. If you’re looking on Craigslist, that information won’t be available, so take extra precaution.
Looking for a rental agent you can trust--and a landlord with a good reputation? Put your search in the hands of Triplemint, a tech-savvy real estate brokerage and Brick Underground partner. Founded by a pair of Yale grads in response to the frustrating apartment-search experiences of classmates and colleagues, Triplemint will charge a broker's fee of 10 percent of a year's rent instead of the usual 12 to 15 percent if the apartment is an "open" listing and you sign up here. Bonus: The agents at Triplemint are a delight to deal with.
If you think you’ve stumbled upon an amazing apartment deal, that’s another reason to proceed with caution. “If a price seems too good to be true, trust us, it’s too good to be true," says Joe Charat, general manager at Naked Apartments, an NYC rental search site. "It’s likely not a real apartment, or not accurately listed." (It may be advertised as a two-bedroom but may be illegally subdivided, for instance.) “To safeguard against this, do your research and know a ballpark figure for what typical asking rent is in the area with the amenities you’re looking for." You can do so using his website's Neighborhood Finder tool (or by checking Streeteasy and other databases that list prices; a quick sweep through websites of big brokerage firms like Citi Habitats, which has tons of rentals, or the New York Times apartment-finder tool, will also arm you with lots of stats). A perusal of apartments in your desired size and neighborhood will quickly give you an idea of what's a typical price and what's not.
If you decide to reach out about the listing, have a list of questions to test its validity. “Learn to read between the lines, and force your broker to be brutally honest from the get-go,” advises Riefflin. “Make sure to ask the broker some pointed questions: "How many others have you shown this listing to?" "Why is the listing still on the market?" "Can I see the floor plan for this two-bedroom?” (Hint: It could be a railroad apartment). "Is the subway really only a 15-minute walk?" (Try to confirm this on your own via Google maps, as well.)
Also research the broker; there’s been a Streeteasy-based scam in which agents outside of the city post properties that don’t actually belong to them. “In the search results, do you see evidence of a quality agent?” Riefflin asks. “Does the site appear to be up-to-date, or is it filled with broken links from 2005... If the agent does not list a brokerage, that’s also not such a great sign. If they’re associated with a major brokerage, they’re more likely to be legitimate.” You should also check to see if the agent has other listings on Streeteasy and follow-up on them—if they all look the same or have the same address, consider them red flags.
Once you’ve met your broker in person, there are both subtle and upfront ways to check if they’re the real deal. Ask them to describe the terms of the lease and details about the building, landlord or previous apartment tenants. If anything seems fishy, you can always ask to see the agent’s real estate license and match it to their picture ID to get confirmation they’re working with the building landlord. Every licensed broker is required to carry their license and shouldn’t balk if you ask to see it. (A good broker, too, should have your best interest at heart and be responsive if you explain that you want to avoid a rental scam!) That’s a good final move before putting down a deposit to secure the apartment, says Charat, especially if there are any lingering questions about the legitimacy of the listing.
Money wiring for nothing
Are you being asked to wire money for an apartment before you’ve even see it, or before you’ve been promised a lease? Don’t do it. “You should never wire money, or put a deposit down of any kind without seeing the apartment in person,” says Riefflin. That goes for all personal information, she added: “You should also never give out any sensitive personal information—think social security number, bank account information, pay stubs, etc.—by phone or email."
Charat says this is a common practice by scammers preying on out-of-towners looking for a New York apartment. “[It’s] an apartment that looks like an absolute steal, and then say they need to wire money to secure it,” he said. “Never wire money before seeing an apartment—99 percent of the time, it’s a scam."
Other scammers will try to sublet a place that doesn’t actually belong to them—someone they know owns it or the apartment was rented via Airbnb. Here’s a firsthand account of a West Village listing that appeared on Craigslist that the potential renter got to see in person. She lost her deposit after her contact disappeared; the apartment actually belonged to someone who was subletting it, then that sublettor rented it out for short-term stays on Craigslist. It was that short-term sublettor who showed hopeful renters around to collect deposits before she vanished. A word of warning from that experience: Be wary if anyone asks for cash upfront and won’t take a check. That scammer also didn’t ask for a credit check, or a security deposit, which are other signs that something’s up.
Here’s another account in which scammers rented an Airbnb apartment for the weekend, listed it on Craigslist, and showed it as their sublet (giving details that the real resident already supplied them). They collected “deposits” from several people who responded to their ad before disappearing. After the experience, the renter who got scammed found the apartment listed on Airbnb. So if something seems off about the sublet, it’s a good idea to check out Airbnb (and other vacation rental websites, to be safe). Also, be sure to ask your potential sublettors to see the lease and confirm the name matches the sublettor’s ID. You can also ask for the contact info of the landlord.
Gross Rent Calculator
Some New York City landlords offer a free month (or more) at the beginning or end of a lease. The advertised rent is the net effective rent. The net effective rent is less than the amount you will actually have to pay --- known as your gross rent --- during your non-free months.
Brick Underground's Gross Rent Calculator enables you to easily calculate your gross rent, make quick apples-to-apples comparisons between apartments and avoid expensive surprises. All you'll need to figure out your gross rent is 1) the net effective rent, 2) the length of your lease, and 3) how many free months your landlord is offering. [Hint: Bookmark this page for easy reference!]
To learn more about net effective versus gross rents, read What does 'net effective rent' mean?.
If the landlord is offering partial months free, enter it with a decimal point. For example, 6 weeks free rent should be entered as 1.5 months.
So you’ve secured a legitimate apartment—congratulations! Now be sure you won’t get duped during the big move. There are a few things to look out for when hiring a mover: the bait and switch, when a mover offers you a great estimate but jacks up the price when it’s too late to back out; holding your belongings hostage until you agree to fork over more money; and even “phantom delivery” in which the mover will pack up your stuff, take your money, and disappear. As with your broker, research your mover: Get a recommendation for one from someone you trust, check reviews online, make sure their website has a legitimate address and contact info, and ask them for references.
You can even check to see if your mover is licensed to operate in New York by the NY State Department of Transportation (call 800-786-5368 or email [email protected]). Any cost estimates should be given to you in writing, and you shouldn't pay up front or give any type of deposit.
Sign-ups for utilities without your permission
It’s called “slamming": When scammers pose as utility company reps, promise you lower energy bills, get your account information, and switch your service without permission. Con Ed doesn’t send reps to people’s homes to check their utility bills, so if someone comes by claiming to be with the company, tell them you’re not interested. (You can also call 1-800-75-CONED to confirm if someone is actually with the company.) This can also happen over phone, so be wary if you get a call from someone claiming to be a utility rep, then asks for your account or any personal information.
The bottom line
In all cases, trust your gut and if anything starts feeling shady, proceed with caution and do your research. Charat sums it up: “In general, if anything seems wrong about an apartment, or the person representing the apartment doesn’t seem like they can be trusted, trust your gut, walk away, and contact the listing service or your local authority. Be very careful before handing over any money, providing any financial information, or meeting anyone in an unsafe place.”
If you’ve stumbled across a suspicious listing, you can submit it to Streeteasy, Naked Apartments, Craigslist, and most other websites to investigate the issue. And if you do get scammed, you can always contact your local police precinct—although in many cases they can do very little for scammed renters. All the more reason to proceed with caution from the get-go.
You Might Also Like