May 1—LEWISTON — Today’s housing market is, in many ways, the tightest it has ever been in Maine and the entire country. There are simply more potential buyers than inventory – an imbalance that is unlikely to resolve for months or years.
Despite fears about inflation and rising mortgage rates, the insatiable demand for new and used homes continues.
Sales of existing single-family homes in Maine were down 21.48% in March 2022 from March 2021, due to a recent lack of inventory, coupled with pent-up demand from buyers, according to the latest numbers released by the Maine Association of Realtors. But home prices continue to soar, with the median sale price up 21.4% to an average price of $325,000 from March 2021, which saw median sale prices at $268,500. .
Androscoggin County bucked the trend in March, seeing sales rise 9.22% in March 2022 compared to March 2021, from 217 homes to 237 homes.
“The market is moving faster than it has ever been,” said Madeleine Hill, president of the Maine Association of Realtors. “And when you’re in a fast-paced environment and in a highly competitive environment, you have to think and act fast.”
The buying and selling frenzy created an atmosphere of pressure and stress in an already demanding process. Buying a home is, for most people, the most important purchase they will make in their lifetime. And for some, it’s the only purchase of this magnitude. But even for the experienced home buyer and seller, buying or selling a home has taken on a whole new set of variables never before seen in the industry.
All of this pressure has created opportunities for scammers who see it as earning potential. Make no mistake, today’s transactions and payments are more important, with most transactions taking place virtually, opening the door to professional thieves and hackers working together.
PROPERTY CRIME GROWTH
Nearly 3 million consumers in this country reported losing $5.8 billion to all types of fraud in 2021, up 70% from 2020, according to the Federal Trade Commission’s latest report. Imposter scams, followed by online shopping scams, were the most popular categories of fraud.
Real estate is the third most common industry for fraud attempts behind construction and commercial services, according to the findings of a 2019 Treasury Department report.
Housing scams are prevalent in all aspects of the housing industry, with criminals targeting tenants and landlords. It’s a crime that’s growing exponentially and it’s easy to see why – more real estate transactions are being done virtually and the amount of money involved has also reached hundreds of thousands of dollars or more per transaction.
In its 2021 Internet Crime Report, the FBI identified 42 victims of real estate/rental crimes in the state of Maine, with total reported losses for the crime at $489,309. He identified 14 subjects, which the report defined as “the individual who commits the crime”. Subject-related losses reached $528,953 in Maine. All statistics are from victims reporting to the FBI.
Nationally, there were 11,578 victims of real estate/rental scams, who reported losses in 2021 of $350,328,166, a figure that jumped dramatically from 2020, when losses occurred. been reported at nearly $213.2 million.
The federal agency is responsible for investigating, tracking and reporting crimes on the Internet through the Internet Crime Complaint Center, known as IC3. It depends on victims of crime to report the details through its internet portal.
HOW REAL ESTATE SCAMS OFTEN WORK
The thieves behind internet fraud are increasingly sophisticated, tech-savvy and persuasive. You will probably never talk to them if you become a target, as they almost always communicate via email and text. This is the first red flag. They are engaging, even to the point of answering questions such as “will I have access to the kitchen and the rest of the house” from a potential tenant.
By far the most common real estate crime is wire fraud. What usually happens is that a real estate agent’s or title company’s email is hacked, revealing a buyer’s information and closing details. The scammer will then impersonate the seller, instructing the title company to transfer the blocked funds to the scammer’s account instead. Or the impersonator will impersonate the title company’s letterhead and email and request that the closing funds be transferred to them.
This is what almost happened to a buyer working with Portside Real Estate Group. Mike LePage, a designated broker with the Yarmouth agency, explained: “Well, we got a call from a bank saying they had discovered wire fraud from a buyer trying to buy a property, who was closing in two or three days.”
LePage would only say that the transaction amount was over $100,000. “He received wiring instructions from the title (company), from someone who looked exactly like (they represented) the title company.”
LePage said the buyer’s agreement closing statement was attached to the wiring instructions, even before the real estate company received the statement — something that should never happen.
LePage believes what happened was that the real estate title company emailed the closing statement to the real estate company, who then emailed the information to the buyer, which is usual, but somehow she was intercepted by scammers. The scammers then posed as the real title company and sent the information to the buyer, with instructions to wire the money to the scammer’s account.
So how was all of this exposed?
“When the buyer called the number that was on the wire fraud, he answered with the name of the title company,” LePage said. “(But) when the bank called the number, it rang and rang and rang and rang.” Bank staff immediately became suspicious, most likely because the phone number given by the scammers did not match the number of the actual title company.
The bank stopped the wire transfer and no funds were lost in this case. The FBI is investigating.
Other types of real estate scams
There is also title or deed theft, where title to a home is obtained illegally and thieves then impersonate a real estate agent or other professional and then attempt to sell the house to an unsuspecting potential buyer.
Finally, there is the age-old rental scam. The Maine Attorney General’s Office publishes the following description and disclaimer on its website:
“This scam is commonly seen on Craigslist or other websites. Recently, a Maine landlord discovered that his house, along with photographs of the property, were being rented out on Craigslist without his knowledge. The ad mentioned a Nigerian email address for replies and payment.for fictitious rental.A buyer was ready to rent the house by sending his money to Nigeria.Luckily the buyer contacted the owner from Maine and found out about the scam before to send funds to the scammer.
Other consumers haven’t been lucky enough to arrive at their paid-for-week vacation home or new apartment to find it’s not for rent at all. Remember: never send money in response to an Internet or rental offer without first confirming that the ad is legitimate or from a known and trusted company.
What can you do to protect yourself? Most people don’t know who to turn to when they are victims of real estate fraud. Some turn to the local police. Many do nothing, embarrassed by the scam and not knowing how to handle the situation. Officials acknowledge that the number of scams and fraud reported to them is far lower than the actual number.
There are a number of precautions you can take to protect yourself, but perhaps the best advice is to never transfer money to someone you don’t know, even if you’re desperate for a rental. and never give your social security number to anyone who emails you an application. Never.
Take the time to verify the real owner’s name in the city or county where the home is located. If the name doesn’t match the rental ad, it’s more than likely a scam. For a full list of ways to protect yourself and who to contact if you think you’ve been the victim of real estate fraud, see the related article.
In Maine, the attorney general’s office does not prosecute wire fraud; most scams committed on the Internet are federal crimes and often involve interstate commerce. However, the office can offer assistance. A spokesperson for the bureau acknowledged last week that real estate scams were on the rise and that vigilance was needed.
“It’s clear that real estate scams are becoming more mainstream and more sophisticated,” the person said. “We encourage anyone who has been the victim of a real estate transaction scam or wire fraud to contact our Consumer Protection Division so that our office can directly assist or direct victims to the enforcement agency. appropriate.”
People can call the Attorney General’s Hotline at 207-626-8849 or 800-436-2131 toll-free in Maine. The hotline accepts calls from 9 a.m. to 12 p.m. and from 1 p.m. to 4 p.m., Monday to Friday.