Condo renters need more protection from scammers: NDP
Some in Queens Park are calling for more protection for prospective renters against fraud as the average cost to rent a one-bedroom apartment recently topped $2,000 a month in Toronto.
This comes after at least two dozen people, mostly international students, came forward to CityNews, claiming they paid thousands of dollars in rent to a man to rent a suite he did not own.
“It’s an unfair situation for renters,” said NDP leader Andrea Horwath. “Their recourse is lacking. We need to look at what we can do because many of these folks are very vulnerable. Let’s face it. First and last month’s rent can be quite a substantial amount of money.”
Bum Joon Kim, 39, was arrested in a parking lot on Monday and now faces 21 charges in connection to an alleged rental scam.
Last week, two international students from Japan told CityNews they separately handed over thousands of dollars in rent to the same man, for the same Front Street condo.
One of the students handed over $5,600 in rent while the other paid nearly $8,000. According to the students, the man purporting to be the landlord, Kim, gave different reasons for why he needed the cash up front.
Homebuyers who put down large down payments are protected by law by paying a real estate brokerage that in turns holds the money in trust.
There’s also Tarion, mandatory insurance that builders in Ontario must provide under the Ontario New Home Warranties Plan Act. The maximum coverage available for new homes and condominium units is $300,000 — if there’s any instance of fraud or delays in closing or occupancy.
Mark Weisleder, a real estate lawyer and author, says the only way for renters to protect themselves is by avoiding online sites like Kijiji and Padmapper and going through a real estate agent instead.
“Beware of the internet stuff,” Weisleder says. “(Renters) have to make sure that they are dealing with a licensed real estate brokerage because then the money is paid to the brokerage in trust and it’s protected.”
Tenants do have the option to go through the Ontario Landlord and Tenant Board, an entity that can make legally-binding orders of repayment, but often these battles end up in small claims court, a drawn-out process that can take months.
By the numbers: real estate and rental listings on Kijiji
Canadian real estate listings at any given time: 466,000
Canadian rental ads at any given time: roughly 250,000
Toronto apartments and condos for rent (last 30 days): 21,733
Toronto houses for rent: 13,682
Listings for rooms for rent and roommates in Toronto: 19,148
Number of Toronto ads deleted (marked as “sold”): 7,039
Average duration of these ads: 12 days
Tips for protecting buyers and renters:
Research other properties in the area to gauge if the property is priced appropriately for the market. Does the price seem realistic for the number of bedrooms and location? Keep in mind that if it sounds too good to be true, it likely is.
Watch out for overly flowery descriptions and extensive lists of features as these are often signs of a realtor marketing a property, and not that of a landlord trying to rent out a house or apartment. Another warning sign is descriptions of repairs like the roof or furnace, as that is not relevant to renters, only buyers. These are often copied from other real estate sites by scammers to appear as descriptive as possible.
Be careful of ads that ask for responses that include age, occupation, income, gender and more personal information such as bank or social insurance card number; these can often be attempts by scammers to store information.