Florida homebuyers and sellers are losing more than $7 million each year to real estate scams during the holiday season. A recent analysis ranks the state at the top of the nation for financial losses from real estate fraud.
A study conducted by PPS House Buyers used data from the Federal Trade Commission to reveal that Florida has experienced 95.6% more real estate scam reports than the national average of 1.14 per 100,000 residents. The surge is said to derive from a perfect mix of holiday urgency and increased digital communication, along with limited staff to monitor activities.
Holiday pressure equals the perfect storm
December has proven to be a vulnerable month for buyers, as they race to purchase properties before Christmas. As renters prepare for the New Year, scammers create opportunities with the increased urgency to rent.
“The holidays create the perfect storm for real estate scams, as buyers feel pressure to close before Christmas, and scammers exploit that urgency with deals that seem too good to miss,” said CEO of PPS House Buyers, Joel Medrano.
The most common methods of holiday scams include fake rental listings that demand deposits before viewing and wire transfer fraud during a closing, along with fraudulent online listings of impersonated sellers or agents. These scams mimic legitimate transactions so closely that victims do not realize what is happening until they have lost a considerable amount of money.
Fewer scams but devastating losses
The study also reveals that states with fewer reported scams face shocking financial impacts. Wyoming and North Dakota have an average loss over $75,000 per incident showing the severity of wire fraud and title impersonation schemes across the nation.
“It’s concerning how some states with fewer reports still see victims losing enormous sums of money,” stated Medrano who carried out the study.
Protection methods for buyers and sellers
Consumers are warned to treat any offer that seems to be “too good to be true” with skepticism. Verify all the agents and title companies through official channels. Do not send wire payments strictly based on email instructions. Make sure to have an in-person or authenticated virtual property viewing. Lastly, confirm all contracts and payment instructions directly by phone with verified numbers
Vigilance can be the most important tool buyers and sellers have under the holiday rush and Florida’s high scam rate.
