As the rental demand rises, rental scams are becoming increasingly prevalent. Today, we are joined by Cameron Choquette, CEO of the Saskatchewan Landlord Association (SKLA), to discuss rental housing scams and their impact on both renters and landlords. Cameron highlights the increasing prevalence of scams targeting prospective tenants, offering key red flags and practical tips for renters to stay vigilant. He emphasizes the importance of verifying listings and shares insights for landlords to protect their properties. Tune in as we discuss the long-term consequences of rental scams and explore the significance of education and vigilance in the evolving landscape of rental housing.
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[INTRODUCTION]
[0:00:43.0] ANNOUNCER: Hello, and welcome to Sync or Swim, a weekly podcast brought to you by Rentsync, where we take a deep dive into the PropTech, multi-family, and rental housing industry. In each episode, we uncover the technologies and strategies used to help overcome operational challenges and increase the value of your multi-family investments. So let's get into our conversation today.
[INTERVIEW]
[0:01:09.2] MH: All right, welcome back to Sync or Swim, the podcast where we take a deep dive into the Prop Tech multi-family and rental housing industry. I'm your host Matt Hildebrand, and today, I'm joined by Cameron Choquette, CEO of the Saskatchewan Landlord Association, otherwise known as SKLA. Cam, welcome to the show.
[0:01:25.4] CC: Wonderful, thanks so much for having me on.
[0:01:27.4] MH: Absolutely. Also, on the call today, I have Giacomo Ladas, communications manager at rentals.ca. Giacomo will actually be joining the show moving forward. As the leading voice for rentals.ca, he'll be able to share his thoughts and stories from as many encounters with industry professionals across the country. So Giacomo also, welcome to the show today.
[0:01:47.3] GL: Thank you, Matt.
[0:01:48.3] MH: Now, before we get into the topic today. Cam, why don't you tell us a little bit about yourself and what SKLA does?
[0:01:55.6] CC: Well, SKLA, or the Saskatchewan Landlord Association, originated almost 30 years ago, back in 1994 because the landlords in Saskatchewan can only charge CAD 125 per damaged deposit. So a group of folks met in the basement of a hotel for quite a few months and our association was born and here we are, almost 30 years old, still advocating for rental housing providers.
Still supporting them through legal information, education, training and ultimately, we're here as the voice of rental housing in Saskatchewan and I've been here for nearly four years and have the pleasure of working with over 700 members who collectively own, operate, and manage over 50,000 rental housing units in the province. So it's a dynamic industry and I'm so glad that I get to lead it here.
[0:02:45.1] MH: Well, thanks Cam, we're glad to have you on the show today as well. The reason I wanted to have you on is to talk about the rapidly growing issue and one that is to me that we're all kind of passionate about at the moment specifically and that's rentals scams and in 2022, the Better Business Bureau ranked rental scams as the seventh riskiest scam in Canada.
The first time rental scams have made that top 10 list. With four to 10 Canadians exposed to rental scams have actually lost money because of that. These scams impact both renters and landlords in negative ways and unfortunately, we only see it getting worse. Cam has done an exceptional job bringing awareness to this issue so I think we're just going to get right into it. Cam, can you just maybe start us off with explaining how prevalent rental scams are and what are the most common types of scams that renters encounter?
[0:03:27.0] CC: Well, when I first started, I maybe heard of a few rental scams a year from tenants who called our office. Now, it's nearly on a weekly basis in 2023. That's how much more prevalent and consistent the scammers are and I think that's because rental demand, as reported by you folks has just grown significantly, even in the four years that I've been here and it seems that as we get to the fall every year, this issue rears its head once students are coming back to Saskatchewan to find rentals.
We've heard a lot more around scams even just in the last couple of months, which prompted our awareness with our colleagues at The Better Business Bureau of Saskatchewan and the Saskatchewan Realtors Association. The most common type of scam we see is tenants sending money to a fake rental housing provider, prior to signing a tendency agreement, prior to seeing the rental unit.
Then they go to the rental unit because the scammer has promised the keys are in the mailbox, so they're going to meet them there and lo and behold, the unit is not even for rent, there's wonderful tenants already living there or maybe it's for sale and what we've seen is just a dramatic increase in those kind of claims over the course of the last few years here in Saskatchewan.
[0:04:54.0] MH: What are some red flags that renters should be looking out for when searching for rental properties either online or in person?
[0:05:01.6] CC: Well, the first one I look for or I would advise renters to look for is if the property's for sale. So if there's an address on the property, check and see at any number of homeownership sites, be that the MLS or others, if the home is for sale because what we've actually seen is scammers taking photos from realtor.ca or whichever site they're using, posting them on any other Internet listing site and then caught lying and saying it's for rent when it's actually for sale.
So that's a quick one, just type in the property address, see if it's for sale. That's largely for single-family homes you can do that. I would say look at the property description. If it seems cagey, it probably is cagey. Most good rental housing providers, people who are looking to rent their suites legitimately have very good descriptions, clear expectations of potential tenants. If it's two or three sentences and says, "Very cagey” or unclear things, those are two really easy tips to just watch out for right off the top.
[0:06:11.8] GL: No, those are great tips and when you say something like that, it seems almost obvious but it's amazing how sometimes it doesn't seem that way at first. I think the next step would be then, Cam, so these red flags are seen, right? Someone notices that. Are there tools and resources that renters can use to maybe seek out assistance if they see something like that and hopefully, prevent this from happening to somebody else?
[0:06:31.4] CC: Well, by all means, here in Saskatchewan if someone is scamming a rental, reporting it to the economic crime sections that either Prince Albert Saskatoon or Regina Police Services or to the RSRCMP if you're in rural Saskatchewan, and then I think a great idea, you know, if you're in a tenant community or forum online, warning people is also a great opportunity to do that.
Check for watermarks on the photos, some rental housing providers are increasingly putting their branding on the photos so that they can match, tenants can match that branding with who the listing rental housing provider is. So that's a good tool to see. So be careful to look at the photos and then I would say is don't be afraid to ask a lot of questions when to verify the legitimacy of a listing.
A very professional and legitimate rental housing provider will know the ins and outs of their listing. If a scammer appears to be unknowledgeable or unaware of some intricacies, that's probably a good sign that they really have no idea about this property. So those are a few things I recommend as you work through the process.
[0:07:42.6] MH: You mentioned something there, how some rental housing providers are actually taking some actions to make sure their properties seem more legit and more attractive to renters. Now the rental scams really, not only harm renters but they're impacting landlords as well.
So switching a little bit to the landlord side, how have you seen rental scams impacting landlords and what are some common scams that are more targeted at landlords and less so renters?
[0:08:10.6] CC: Well, for the rental housing provider, their properties are being ripped off to legitimate tenants. So we see the tenant come to Joe landlord and say, "I gave you a thousand dollars, why can't I rent this unit?” and Joe landlord doesn't have a clue what this prospective renter's talking about because they've been scammed.
It also just really negatively impacts, I guess, for a lack of a better word, the vibe of the industry right now. I mean, tenants are desperate because rental demand is sky high and there isn't enough supply to satisfy that demand and these folks are getting scammed out of thousands of dollars and there can be a temptation to blame the industry that we're not doing enough to protect tenants but really, rental housing providers are doing their best.
They're trying to use watermarks, trying to provide good descriptions, secure application portals to verify those listings and prospective tenants but ultimately, the onus here is on the tenant, on the renter, to make sure that they're asking those key questions to verify the legitimacy of a listing and a rental housing provider.
[0:09:17.7] MH: Yeah, that's a good point, there's only so much the rental providers can really do. A recommendation, we always say is making sure you're using a site that's safe and secure. I know there's a few sites out there that are doing a little bit more due diligence when it comes to verifying landlords, having to upload ID and go through a couple of checks and balances to make sure that they're up there.
I know rentals.ca has a really good landlord verification process right now. So I mean, if you are a landlord out there, taking that extra step, verifying, you might have to upload a piece of ID or submit a document but it does go that extra mile to make sure that your property and your brand itself seems more safe and secure to renters out there.
So other than that, I mean, landlords, what are some potential warning signs that they might be seeing or like have you seen anything from that side that's a bit of a warning to a landlord to "Hey, maybe this tenant application doesn't look very legit.”
[0:10:19.0] CC: I think when tenants aren't willing to provide the information requested or are providing insufficient answers to application questions, I think are – is a good sign, especially if an application portal or process is secure, a tenant should have no trouble providing that information. So that's a really easy sign to look for and ID is really important now in rental housing and probably more so than it's ever been just in terms of verifying who our perspective renter actually is.
In times as we've seen the industry change and subletting come on board and additional occupants, it's so important to know who is in the unit. So IDs become just such a hallmark piece of the application process because of course, as you guys well know, tenancy agreements are legal binding contracts. So you have to have the right name on the contract, right? And I think that's really important.
But from our perspective, rental housing providers need to ensure that tenants feel safe in that application process to prevent identity theft and all of those things and only asking for the information that's required and that actually helps verify eligibility. So being careful what to ask, seeing if they're answering, and then making sure that that data goes out, those answers are stored properly to protect the tenant's privacy.
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[INTERVIEW CONTINUED]
[0:11:56.7] GL: So then Cam, you know, God forbid if this does happen to a landlord, right? If the property does become part of a rental scam, are there ways that they can kind of work with the authorities to either address this issue or any sort of recourse that landlords have if their property becomes victim of a rental scam?
[0:12:11.0] CC: What we encourage all of our members to contact the police service, report the illegitimate posts, whether you're using Facebook marketplace, rentals.ca, or any number of other Internet listing sites, using that report function to get those fake ads taken down is really important and then, I would say, updating descriptions.
Giving tenants the tips right in the descriptions to verify, making sure your website URL is linked directly back to your property management or your rent housing kind of central landing page. All of those things show tenants that you're ready and willing to support them and really, just being able to answer those questions clearly I think is important and I always try to confront the scammers.
Maybe that's just me but I always try and confront them with a phone call or a cease-and-desist email to say that we're on to them because they do get scared because they know they have very few chances to capitalize on this before they're caught, or at least before they're made aware of. Often, these scammers never get caught by the police service.
But at least, they kind of go dormant for a while and they come in a few months later, a couple of weeks later and try it out. So I know I had a couple of repeat scammers that go under the same name under the same phone number. We've tried to contact them and it does work, you know it scares them away but that's only a temporary solution for now.
[0:13:38.4] MH: That's good advice for the renters. Obviously, confront the scammer if you're the landlord, make sure you're contacting the authorities. We know some of these situations can get a little messy, you talked a few minutes ago with subletting. There is a big rise in sublet scams, you know there's other emerging rental scam trends but we all know the LTD board has always backed up the landlord-tenant board.
So if you are seeing things like a sublet scam like we mentioned, where the landlord is unaware that their tenant has rented out their place to somebody completely random, what is some of your advice to landlords in those situations because not everyone knows how to deal with it or really where to go?
[0:14:21.8] CC: Well, you know, knock on wood, here at Saskatchewan our LTB is called the ORT, the Office of Residential Tenancies, we're not nearly as backed up. We can usually get an application heard in about four to six weeks, so we're lucky in that sense and sublet scams haven't come to Saskatchewan quite like they have across the country. We have encouraged all of our members to have lease clauses that state-written permission needs to be provided.
But of course, if a tenant doesn't do that I would suggest having regular inspections scheduled in the units so that you can discover who is there. It is a very tricky situation because tenants do have a right to privacy but at the same time, a landlord needs to know who is in that unit. Regular inspections, walk to the property, and encouraging I guess the community if it's a multi-family building to report suspicious or unknown people in the property regularly to the property manager.
So it is one thing to have guests in and out of the building but coaching people to be observant and alert on who is consistently coming into the building if they are new, those may turn it. If you build that culture of accountability, it could help tip off a property manager to see if anyone is illegally subletting but inspections are a great way to do that and monitoring Internet listing sites for your properties and the units to see if anyone is essentially trying to market them illegally or in a scammy way.
That does take some resources but it could be used especially in days of tight demand, you know if you are marketing the one unit you have vacant. So just keeping an eye out to see if someone else is also marketing that one unit for you.
[0:16:12.4] MH: Yeah, that's good advice. It should be quite obvious in some of those scenarios. On the sublet side of things, it can be, you talked about demand. People are looking for more places, subletting is on the rise a little bit but what would your warning be to people looking to sub or looking to rent from a subletter because their name won't be on that lease, so they don't have the same kind of rights that the actual tenant might in these situations.
[0:16:39.5] CC: Yeah. Well, it's – when you're a subletter, you become a subtenant and the actual tenant becomes your landlord and the actual landlord is kind of an arm's length from you even though you're in your property. So it's a bit of another legal nuance to this situation. You know, I think there is some risks because you don't have a direct relationship with the property manager especially if you're in a unit that's being illegally sublet.
You have no right to be there in that sense if you're the subletter who has fallen to a sublet scam, maybe out of desperation that you need a rental unit but if you're the rental housing provider or if you're the original tenant that has agreed the subletter even without your rental housing provider's permission. You take on all of the risks for that tenant that you brought in to sublet. If they kick the walls in, the property owner is going to come to you, the original tenant, for those damages.
So there is a lot of risks, it's much better to be open and honest if you can make an arrangement with your rental housing provider to sublet it legally, maybe to end your lease early if that would be amicable for both parties because there is a lot of risks when you introduce another person into this legal transaction and with delays, it could cost tens of thousands of dollars and even more if you get the wrong person in there that doesn't care about that property.
[0:18:05.4] GL: So Cam, not to get too doom and gloom, we got to shift gears a little bit and kind of see how the Saskatchewan Landlord Association and the government can potentially work together to address these rental scams effectively and then obviously, hope to protect the interest of both parties. So if you can speak a little bit on how that relationship worked, I think that would be really insightful.
[0:18:24.7] CC: Well, we have a great relationship with the ORT here in Saskatchewan, regular meetings with them to ensure that they're aware of what our members are facing, what some of those chronic problems our members face in regards to rental housing in the province. The governments largely play an adjudicative role through the LTB or ORT in the rental housing sector. They also provide a lot of regulation, in terms of rent increase timelines and whatnot.
You know, I don't think we'd advocate for more regulation to prevent rental scams because you can get into a big sea of red tape but it would be nice to see adequate resources to those economic crime units in polices services to track down where these money is going. That can be done and it's usually done on larger scale kings but 2,000 or CAD 2,500 for a family looking to rent a single-family home is a lot of money and they almost never get that money back.
I think we need to do some more investigation as an association to see if there are opportunities to get that money back. If renters could possibly be made available to get them service funds, where victim surcharges charged on crimes could maybe be dispersed to renters subject to this kind of crimes but really, we just need to increase vigilance because that's ultimately what will prevent increasing scams is if people are educated about what to look for because it's as simple as making a phone call to verify legitimacy that can save a renter thousands of dollars and we all have phones now so it should be easy to do that.
[0:20:07.1] GL: Yeah, Cam, and kind of going from that, you know especially with adding the whole idea of we need to increase education on these issues, maybe we could narrow down a little bit on the long-term consequences on these rental scams, right? On the rental market as a whole, maybe there is some things that people don't really realize yet. So maybe you can just go on a little bit more about the long-term consequences and why being educated on this topic is so important.
[0:20:28.7] CC: Well, I mean, scams impact renters to a larger degree than rentals and provides. So I think the long-term impact on renters is they're in a cost-of-living environment that we're in, where people are already strapped to buy food and gas and pay rent and utilities, losing one month's rent, which is the common value, a scammer will say, "Well, just send me one month's rent for the security deposit, I'll hold the unit” right?
Losing one month's rent in today's day and age is a lot of money and that could mean being homeless, that could mean being required to go to the food bank, any number of downstream effects when you all of a sudden lose one to three thousand dollars to a scammer. It means putting that home purchase or in this case, signing that tenant's argument down the road until the next paycheck, which creates housing instability in the province, which we don't need any more of.
You know, I think that is the biggest thing. It also likely means that there will be more barriers to access tenancy agreement applications, right? There will be more steps in the verification process that seem annoying, that seem troublesome, and for those of us that are well-read and don't have any issues in our lives, we can navigate those barriers well.
But for folks who have lower incomes who maybe aren't as well-educated or are suffering from other circumstances in their life, be that mental health or addictions or drug abuse, those additional barriers in applications or tenancy agreements are very hard to get through. That again increases the instability of housing for lower-income Canadians, which we again, we don't need more of.
So some nuances, some complexities down the road if these scams continue to get worse because of course, rental housing providers will be looking to ensure legitimacy. So uploading ID, all of those other things will all kind of just become standard, which does create barriers in the long run for those people who may struggle with technology or other things. So a bit down the road, hopefully, we don't get there but you know, if I had a crystal ball I think that's what might happen.
[0:22:39.9] MH: Yeah, instability is definitely a long-term consequence and one thing too from the rental housing provider standpoint is if scams are happening on your watch essentially, you're going to lose that trust and next time somebody is probably not going to trust your website again even with verification, everything like that. So that instability in such high demand and that loss of grand trust is really, really tough to think about.
I mean, you've given lots of tips throughout this conversation from renters and providers to kind of stay on top of things but kind of closing it out, what is some other advice that you would give to renters and landlords to stay vigilant, proactive in the face of this evolving kind of rental scam landscape we find ourselves in?
[0:23:28.9] CC: Yeah. Number one, don't send money until you've put your pen to paper and signed a tenancy agreement, viewed the rental unit, or at least even applied. You've worked hard for that money, don't send it in an e-transfer and blindly trust someone who says to hold the unit because remember, they could have said that to ten other people or a hundred other people.
So don't send that money until you've signed that tenancy agreement and you're locked and loaded in that rental unit. You've met the rental housing provider and that leads me to my second point, a phone call isn't hard and good professional rental housing providers will answer the phone or view an email, read a Google review, check on, you can use CanLII in Saskatchewan to view if a rental housing provider has been to court before.
So that's another way to check their identity. Call our association if you need to, if you are here in Saskatchewan to see, you know, are they members of ours. I think that's another verification too but if I am a tenant and I have some suspicion around a rental housing provider, I think they should be more than willing to answer their phone to verify it. In a high-demand industry like we're facing right now, rental housing providers might want to answer their phones a hundred times for tenants verifying them.
But those rental housing providers will have a good landing page on their website or an email to contact them, those are other ways to verify the identity. If somebody refuses to communicate except through text, that's a big red flag for me. So those are my two big ones, never send money and try and verify it in simple ways, a call, an email, a Facebook creep, a website creep, those are all ways you can see if people are legitimate.
[0:25:08.0] MH: I think that's very good advice. Well, you know, it's a good time to wrap it up here, Cam. I think this is very educational for both renters and landlords. I know it seems like every other week, we're seeing some article about someone that's been scammed. So I think it's very important to bring awareness to the issue in a time of such high demand and like you said with students coming up.
So I appreciate the time today. Definitely, for anyone out there, you know make sure if you're in Saskatchewan, keep an eye on SKLA, your landlord associations by province. They're the advocates for you, you know they're going to make sure they're putting out lots of resources to help you stay educated and if you do have an issue, I mean, definitely contact the authorities if you think you're getting scammed.
But never be afraid to reach out to an association like Cam's to make sure you're getting the right information. So again, thank you Cam for joining the show today.
[0:25:56.0] CC: Yeah, my pleasure gentleman, happy to be here and look forward to hopefully seeing less scams moving forward.
[0:26:02.8] MH: Right.
[0:26:03.6] GL: Yeah, same page.
[0:26:04.1] MH: I couldn't agree more.
[0:26:05.9] CC: Yeah.
[0:26:06.2] MH: But yeah, talk more, Cam. Thanks again and have a good day everybody.
[END OF INTERVIEW]
[0:26:10.6] ANNOUNCER: You've reached the end of another episode of Sync or Swim. Make sure to visit us at rentsync.com/podcast to access show notes, key takeaways, and where you can sign up to our newsletter to receive free bonus content. If you found value in the show, please also remember to rate, review, and subscribe. Don't forget to join us next week for another episode. Thanks for listening.
[END]