Zillow real estate investment writer and long-term investor Leonard Baron, MBA, is answering questions from MintLife readers.
If you have a question about investment properties, cash flows, insurance, mortgage financing, homeowners associations, renting versus owning, foreclosures and more, drop Leonard an email.
Avoiding Rental Scams
Marge of Columbus, OH asks:
I keep hearing about rental-property scams, in which people without properties get security deposits from potential renters and then disappear.
I’m filling out rental applications with lots of personal information, and I’m more than a little concerned that I’m getting scammed. What can I do to protect myself?
Answer: Thank you for bringing up this topic, Marge. My first piece of advice is to always use common sense and notice potential red flags.
Most of these scams involve properties priced well below the market rate. If the price of the rental sounds too good to be true, you should be suspicious.
Also, any requests to wire money or pay an upfront security deposit before a lease is signed should be suspect.
Or, if the landlord is pushing you to hurry up, sign the lease and hand over a security deposit, you should be skeptical.
Make sure you always see a property in person before you send any money.
Additionally, ask the leasing person if they own the property or work for a management company.
If they work for a company, get their contact information and call the company to confirm.
You could also ask a real estate agent to confirm who owns the property, as they can pull the tax records to verify ownership.
If you are concerned about the information you provide on a rental application, you could leave off social security and account numbers, and say you will provide them if the landlord decides to move forward with the lease.
Most landlords should accommodate this request.
Starting a Real Estate Career
Thomas of Houston, TX asks:
I am an 18-year-old high school senior that is very interested in real estate investing. My plan is to become a home builder at some point in my career.
What advice you would give to someone moving in this direction?
Answer: Every person reading this sentence is jealous that you are only 18 and already thinking about investing in real estate!
It’s great that at such a young age you are thinking about your future.
My advice is to first focus on finishing high school and attending college. If you need to go to community college first to get into a four-year college, do it.
However, I wouldn’t put all your eggs in the real estate basket. Your best bet is to get an accounting degree and your Certified Public Accountant (CPA) license.
As a CPA, you have a really good chance of getting a job in whatever industry you want.
You could work for a CPA audit firm for a few years doing real estate, or work directly for a real estate company.
And, if you end up hating real estate – you wouldn’t be the first person who tried and then loathed the real estate business – you still have lots of great options with your CPA credentials.
Keep your career options open because there is a high chance you’ll be employed in several industries – including home building – over the next 60 years of your life!
Leonard Baron, MBA, CPA, is Zillow’s real estate investment writer, a San Diego University lecturer and real estate due diligence expert. As America’s Real Estate Professor®, his unbiased, neutral and inexpensive “Real Estate Ownership, Investment and Due Diligence 101” textbook teaches real estate owners how to make smart and safe purchase decisions.