In an increasingly digital world, property transactions are no exception to the migration towards online platforms. While the convenience of this online migration offers numerous advantages, it also introduces cybersecurity risks that can have devastating consequences for its victims.
READ: Safety measures to consider when selling and letting homes
“Whether you are buying, selling, or leasing real estate, individuals and real estate professionals involved in these deals must remain vigilant against cyber threats,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa. Meanwhile in a publication in June 2023, Paul Stevens, CEO of Just Property, shared that while conducting research through online portals is valuable for assessing market value and property availability, working through verified agents makes so much more sense. By following these precautions and consulting professionals, buyers, tenants, and landlords can reduce the risk of falling victim to residential property scams."
To avoid falling victim to property scams in South Africa, Stevens, offers the following tips:
1. Always use a reputable estate agent registered with the Property Practitioners Regulatory Authority. Using the PPRA’s website, you can search for an agent’s name to see if they are registered.
2. Conduct thorough research to verify the legitimacy of the property and the seller or landlord. Does the property exist on Google Maps? Is the landlord/seller willing to provide identification documentation to you for verification?
3. Insist on meeting with the agent at their office or the landlord/seller in person before viewing the property to ensure they are who they say they are.
4. Be cautious when providing personal or financial information online and use secure platforms for transactions.
5. Be wary of deals that seem too good to be true, as they are often signs of a scam. Is the rental incredibly low for the value you’d be receiving? Is the sales price far cheaper than the average for the area?
6. Never pay money upfront – legitimate agents and property developers will not require upfront payments other than to draw up your lease and complete your credit checks. If a landlord wants you to pay a deposit before seeing the property, walk away.
7. Consult legal professionals and bona fide property experts to ensure all documentation is legitimate and accurate. They have experience checking these kinds of documentation and have an eye for picking up any discrepancies.
8. Trust your instincts and walk away if something feels suspicious.
“If you’re a buyer, you can check the credentials of your agent by asking for their Fidelity Fund Certificate number and checking this with the Property Practitioners Regulatory Authority,” Stevens advises. "Then contact the Head Office of the property company they work for to confirm the agent and their branch is listed with them. Ideally, complete all paperwork in person at their office. Double-check with the relevant bank to ensure that your deposit is being paid into a trust account."
It is just as important for landlords and tenants to take similar care,” he adds. Managing property agencies, like Just Property, offer protection to tenants by placing rental deposits in trust accounts and partnering with regulated providers such as PayProp. "We also utilise expert verification tools to verify tenants and landlords, adding an extra layer of security to their services."
READ: Real estate safety: Essential precautions for clients and agents
Goslett says these days, cyber criminals are incredibly good at mimicking reputable businesses so that clients think that they are dealing with the real deal. For this reason, Goslett recommends that clients always double check and do some research to ensure that they are working with a reputable agent or related brand:
(1) To verify that they are who they say they are, Google the cell number and email address that the agent / transferring attorney is using to correspond with you. Typically, that number and email address should correspond with the number and email address that is on their profile on the agency’s / brand’s website.
(2) Beware of email spoofing. Double check that the email address is an exact match with your agent’s / conveyancer’s email address or that it corresponds exactly with a reputable brand’s URL. The subject line will also typically look suspicious (i.e. it contains a typo or contains the sender’s email address).
(3) Google the portal on which you found the property listing and look at reviews on the property portals you are using. Any property that is listed on a property portal should also be on the agency’s own website so if it's not, that is a reason to be wary. Be very cautious if you find a property listing that is only on social media and does not appear on any other property portal or agency website.
(4) Never pay money to anyone unless you can verify that they are a legitimate operator. Never trust somebody who only reaches out to you via social media and asks for payments. There should never be any large sum payments due until a written lease agreement or offer to purchase has been signed by both parties involved. Thereafter, it is typically the transferring attorney involved in the sale or the real estate agent involved in the lease agreement who handles all payments. Be very weary of anyone who provides personal bank account details (and not a verified business bank account) or requires cash when arranging for payment.
“As property transactions continue to migrate towards digital platforms, the importance of cybersecurity cannot be overstated. Mitigating cyber risks requires a proactive approach. When you are aware of the risks and choose to work through reputable brands and portals, it becomes much easier to navigate the complexities of property transactions with confidence in the face of evolving cyber threats,” says Goslett.
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