Sign In

X
[The List]: Housing Scams and Nightmares
Tales of fraud, deceit, deception, double-dealing, graft, chicanery -- and straight-up getting ripped off -- when endeavoring to find a home in Shanghai.
By May 12, 2016 SmSh
We all need a little shelter. But why is it so damn hard to get?

One of the busiest and most trafficked sections of our site, the SmartShanghai Housing platform gets around 10,000 housing listings a month. The vast majority of these are legitimate listings from the good denizens of Shanghai -- good people out there trying to live their lives in the properties game -- but a small percentage, of course, are not.

We do our very best to regulate the housings listings each and every day to make sure everything is on the up-and-up. But it's an impossible task. Every so often a scammer will sneak through and attempt to utilize the service to take advantage of someone's good will and steal their hard-earned money.

A brief look at our safety measures: we make agencies go through a verification process; we monitor suspicious listings; we've put up a big notice with dos and don'ts based on all the knowledge we've accumulated over the years. We even recently upgraded the notice to a big flashing red "SCAM ALERT" banner to get people to read it before renting.

But some of our users are still getting scammed. It happens from time to time.

At any rate, to further spread the message of awareness, here's some common, real examples of the scams and stories of housing woes we've received over the years. The more this knowledge is out there, the less likely people will fall for these scams if they happen to encounter them. Positive vibes to all these people whose stories appear here. Rough.


The Scams



1. The Key Scam





"I have been checking SmartShanghai trying to find the perfect house and I found a listing I liked. I emailed the landlord since he is not in Shanghai at the moment. We agreed that I would wire the deposit of 4,000rmb (one month's rent plus a 500rmb security deposit) and he would send me the key by mail. We signed the leasing agreement, but after I wired the money, he started to insist in having me wire another 3,500rmb for the deposit. I reject his request because it seemed a little suspicious. After trying a few more times to get me to wire more money, he stopped replying to my emails."

***



The Key Scam is the most common scam we see at SmartShanghai. The landlord claims to be somewhere overseas (usually the U.S.) and promises to mail the keys that never arrive after receiving the rent and deposit. Never make a bank transfer to the landlord of an apartment without seeing the apartment, meeting the landlord, and testing the keys to see that they work.


2. The Empty Apartment Scam





"I viewed a bedroom in Vivian's apartment and it looked nice inside, but it was empty without any furniture or anything. Vivian said she had just started her lease and was moving in soon. I paid the deposit and first month's rent (4,522rmb) for the room and she gave me a key. When I came back later in the day to move my stuff in, the key didn't work. I tried calling Vivian but her phone was off and has been off for the past three days."

***



The empty apartment scam is another common one we get. The scammer somehow has access to an apartment and pretends that it is theirs, then disappears after taking your deposit and rent, leaving you with a useless key. Don’t let that happen to you. Only rent a shared apartment from someone who is obviously living there. Oh, and make sure you get a real contract.


3. The Double Landlord Scam





"I wish to inform you that one of the housing ads released on your website proved to be a scam. The perpetrator called Sylvester placed an ad for a shared apartment. He sublet his apartment to me and collected a 6,000rmb deposit. Later on, the landlord did not accept this and also refused to return the deposit that I paid to Sylvester. Meanwhile, Sylvester has vanished.

I tried to contact him on his mobile phone and email but he is not responding to me. I am aware of my stupidity of not checking with the landlord before trusting this guy. But some lessons in life are hard learned, right?"

***



Ouch. Right. The most famous version of this story happened in 2012 when a Canadian guy made off with 300,000rmb cheating over 50 tenants and landlords.

300,000rmb.

It's illegal to sublet your apartment unless you have that provision in your contract with your landlord. If you rent from a subletter, get in contact with the landlord, let them know that you are renting from their tenant, and ask to see the original contract, which you'll need to register with the police.


4. Barrier Room Fraud





"I am an expat. Me and my friends (Americans / Germans / Indians) have undergone a massive cheat/fraud by an agency. They partition the house with walls in an illegal manner and then rent it to expats without getting permission from the legal authorities. I had police visiting the house and threatening me for actions when I stayed with this apartment. These agents kicked us out of the apartment with no notice period and they didn't even give back deposits which is of very huge value."

***



It is illegal to add walls or barriers to original building plans and rent them out as additional rooms. When viewing apartments, look closely to see if walls are sketchy and seem like they were not included in the original building plan. If so, find another apartment and another agency.


Other Horror Stories



The following are five stories that don't fit into a specific kind of scam, but occur when you don't follow some basic good practices when renting an apartment.

5. Receipts Matter





"I wish to advise you about this scam operated by someone called Mr. Lee, who rents his apartment to foreigners. He asks for at least two months rent and two months deposit up front, then tells them to leave after a while saying they won't get their money back. If the tenant argues he becomes violent.

I was attacked by him, suffering open wounds to the side of the head and nose. I lost most of my money. My roommate, a German guy who was also in the apartment was punched and lost all his money, and there was an American who lived here before who lost all his money. I called the police, but I couldn't get my money back because he doesn't issue receipts."

***



Whoa.

But yeah.

Get a proof of payment anytime you pay rent to your landlord, especially if you are paying in cash. Even if they can't issue an official receipt, you can ask for a signed, handwritten note. Without one, there's nothing to prove that you've already paid if the landlord asks you for rent or tries to kick you out.


6. Don't Rent An Office To Live In





"I went to see an apartment with my agent and the landlord. We were given a long contract, which my wife and I read through very carefully, then we signed it and paid the 3 months rental and 1 month's deposit.

So far so good. The landlord then gave us (my Chinese wife and I) a copy of the apartment owners booklet and the next day we went to do the temporary registration procedure at the local police station. After handing the documents over to the police lady, she immediately pointed out that the property is for office use only, not for residential living. She pointed at some Chinese words inside the apartment owners booklet. The room we are renting looks nothing like an office.

The police lady was very clear that this is a big offense and she would turn a blind eye as long as we move out immediately. Please advise whether we are entitled to a full refund since the landlord most certainly knew the property was for office use only and not for living, yet they still rented the apartment out for residential use."

***



Yeah, this is a thing. Different buildings and areas are zoned for different purposes, and you can't be living in a place that's been classified and regulated as an office. On the ownership certificate (owner's booklet), under usage (用途), it should say "residential" (住宅) or "both residential and business" (商住两用). If it says anything else, you won't be able to register with the police and getting back your rent and deposit could be difficult.


7. Beware Of Untrustworthy Agents





"This agency scams people for money and tries to force them to take apartments they don't want, cannot afford, or specifically asked not to see. The owner of the agency is very disorganized, pushy and often does not know much information about the units he shows or important things like directions to the place. He speaks fluent English as well as Chinese and specifically targets expats.

A couple of my colleagues were referred to him through our school and they lost 10,000RMB from paying deposits and fees that they were told were mandatory to get the apartment. Then when they went to sign the contract and move in they were told they needed to pay those fees and deposits again. After paying again, they were refused to stay in the apartments and denied return of the money given to the landlords and the agency.

He was completely unprofessional and tried to put me into a position to where I would be forced to take something I did not want nor afford because I had told him I had a limited time-frame to find an apartment. He told me one thing and the landlord another and then tried to put everything on me when the landlord asked what was going on when I challenged the arrangement and terms.

The price he told me was higher than what the landlord said and he was doing this all in Chinese with the landlord as he assumed I would not understand. Also I was told I had to pay his agency fee upfront before paying the landlord the money to take the unit, only to find out that was a lie and the fee was inflated way above the standard or even the average."

***



Stories of people having problems with their property agents are legion in Shanghai.

Typically, the tenant and the landlord each pay 35% of one month's rent to the agency. Try to meet the landlord before signing with the agent. If you don't speak Chinese, take a local friend with you to make sure that the price the landlord is asking is the same as what the agent is quoting. Never pay the agency fee before signing the contract (or preferably before registering with the police), and definitely never pay it twice. If your agent seems shady, don't stick around. Find another.

Again, if your agent seems shady, don't stick around. Find another.

It's very common to go through several agents and agencies when looking for a place in Shanghai.


8. Why You Should Always Get A Real Contract





"After my contract was signed the agency changed or moved in one item at a time, giving their workers the key to not only enter the apartment but also our locked rooms (me and my housemates). I often came home seeing either workers stepping on my bed to fix something while smoking, the ayi using my clothes as cleaning utilities, etc. It was horrible. Especially because I was never notified that someone was coming. We called the owner several times who just came in screaming at us — 'you don't fuck me I fuck you' was the usual.

They held 2 months of my deposit 11,000rmb, so I dealt with it, but I was worried that I would lose my deposit when I left, so I met with a lawyer who told me that their contract isn't worth anything because some major formal mistakes.

I thought okay, what if I just don't pay my last months rent and they wont bother me too much. False thought. The sales agents brought the police to my door and told them that we had never paid our electricity bills and that my rent was overdue. I tried to explain that they kept 2 months of my deposit. They told me they didn't want my rent and just wanted me to pay the 1500rmb in electricity bills and move out...It became too much and I just wanted to have it finished. I felt totally helpless, paid the bills, and they gave me 2 hours to move out. I packed supervised by a smoking Chinese person who opened all my windows and turned off the heater while screaming 'kuai kuai', insulting me, etc."

***



Get a real contract (they should look something like this) with terms, signatures, and copies of the ID or passport of the person you are dealing with. If you can prove to the police that you're owed a deposit and you've paid your rent on time, they are usually willing to help you. We recommend that you avoid renting shared apartments from people who don't live at the apartment -- specifically don't rent shared apartments from agencies as the person in this story did.

Also, for safety reasons, get permission from the landlord to change the locks before you move in. This is a common practice. If they disagree, find another apartment.

Some short term contracts will require you to find a replacement for your room in order to get your deposit back. We don't recommend you signing such contracts, but they are common. If you do have this type of contract, be sure to start looking for a tenant earlier than later.


9. Prepare For A Landlord Who Wants To Keep Your Deposit





"The landlord came on the day I was moving out and complained that there were many problems with the apartment. He pointed at cracks in the wall and small things that were already like that when we moved in. He said he won't give us back the deposit because we did damage to his apartment. Then later he contacted me telling me the washing machine was broken, when it was working fine two days before we left. I tried to settle with him but I think he doesn't want to return my deposit."

***



Sometimes even when you do have a real contract, receipts, and everything in order, your landlord will still try to cheat you by keeping your deposit. To avoid this, take pictures of your apartment when you move in, noting anything that isn't in a perfect condition. It was our experience one time when renting a place in Shanghai that we went through with the landlord and video tapes the rooms and condition of the furniture on our phones.

If your landlord still refuses to return your deposit -- and yeah, this happens all too frequently -- you may have to consult with a lawyer. According to Natalie Yu, a partner at Li Yan Law Firm, a lawyers fee from this type of case could start from around 3,000rmb. You could also attempt to ask a local friend to help you send a complaint directly to the court without a lawyer.

***

We're always on the lookout to prevent new scams. If you feel like it, leave your own story in the comments to help us stay on top of the situation and warn others.

Names in this article have been withheld because... um... because the suffering of one is the suffering of us all. Or something zen like that. Stories were edited for clarity and brevity.

5 comments.

Please register to reserve a user name.
  • 1 year ago Unverified User

    You missed the most important of all….paying 30% more than locals and getting sucked in by a landlord who serially rents to foreigners so they can keep raising the price. I just read a post on my we chat that was asking 12,000RMB for 50 square meter apartment. There's no reason for rents to have risen by 60% in the last 7 years…don't be a stooge to greedy landlords.

  • 1 year ago Unverified User

    My contract ended in March and we asked if we could stay an extra 3 months. He agreed but due a severe illness i have, can only do 2 of the months. There is no written contract, only wechat messages. Asked if we will get our full deposit 11,000, which they said yes if there was no damage. They quickly changed their minds and demanded we find new tennants because its low season. And will keep at least 7000 as thats what they want to be charging a month! What do i do?

  • 1 year ago Nextstar1

    I just moved into an apartment that has extra bedrooms added by additional walls. Is this always illegal?

  • 3 months ago anncharmaine

    IMPORTANT NOTICE TO ALL:

    王颜 a.k.a ‘CHRISTINA’ is working as a rental property agent in Shanghai. This person issued invalid contract document with false information on fees and identification to extort money from both the landlord and the tenant. She produced two different contracts on the same property with forged landlord’s signature on one and fake tenant on the other.

    She worked on apartment rentals under a real estate agency when I first get it touch with her on January 2015 and said to have left the company on that same year. It turned out that she did all the transactions on her own during the duration of my contract; she’s been cheating and lying to the tenant and the landlord all this time.

    I, the tenant and the landlord both discovered all about this whole situation mid of February 2017 upon the expiration of the contract.

    BEWARE in making any transaction with this person!

    王颜 a.k.a ‘CHRISTINA’
    QQ/email: 792214508@qq.com
    Wechat/ Mobile: +86 13524932462

    The latest information about her is that she is dealing with office rentals, most likely targeting expats.

  • 31 days ago sunsetlover

    Though it happens rarely, it should be mentioned, as it afflicts even Chinese tenants: ask to see the landord's Title to the apartment. A Chinese friend of mine almost signed a contract and paid 3 months' rent and deposit to a landlord who legally didn't own the apartment. It was under his wife's (or ex-wife's) name. Even the agent seemed to be not aware of it. With the ease and temporary nature of marriages and divorces in Shanghai (some actually due to housing ownership rules), that can be an honest, but costly, mistake. Your contract would basically be invalid.

    Unless you are dealing with a reputable "expat-friendly" agency, always go with a Chinese friend when signing the contract. You may be provided with the English version which they all can sign, but ONLY the Chinese version stands up in court (and presumably the police) (SmartShanghai, make note of that, your alerts are not clear on that). No Chinese friend available? no problem, take photo of contract and send it to a friend by Wechat.

    Regarding the recent rent rises that was noted in a comment here, let's be real folks, we expats are a tiny share in the real estate market in SH. That same landlord will ask the same 12,000 rmb rent from Chinese tenant. The difference is, as Chinese, they will negotiate it down to 10,000 rmb, plus the Chinese tenant will get 2 other roommates, bringing the rent down to 3,300 rmb pp.

  • Recent Articles
  • Popular
ALL ARTICLES
YOU MIGHT ALSO LIKE ...