Online real estate scams are a new form of financial extortion, using digital platforms such as listing sites, WhatsApp, and other social media. The scammers deceive buyers into paying for non-existent, disputed or misrepresented properties.
Following the 2016 demonetisation and the capping of cash transactions at a specified limit, digital transactions gained momentum. Real estate is among the first movers into the digital space. This benefited buyers and sellers in many ways. The migration of real estate transactions to the online space introduced online real estate scams as a new threat. According to recent national media reports, the RBI governor stated that recovering lost funds from digital financial fraud is a key priority for the Bank of the Banks.
This article explores different types of online real estate scams, how to identify them, and how to avoid losing hard-earned money.
Table of contents
Common online real estate scams in India
Here are some of the common online real estate scams in India
1. The QR code and UPI PIN trap
The Problem:
This is where sellers usually get into trouble due to a lapse in judgment. Any high-value property deal creates excitement and urgency. Scammers exploit this psychological moment to trick sellers into scanning a QR code and entering a PIN to receive money.
Mode of Operation:
- The Actor: Scammers pose as high-trust figures (Eg, Army officers, NRIs, or senior managers) to convince the seller
- The Test: They may send 1 rupee to prove they are serious about the deal
- The Trap: They send a payment QR via WhatsApp, claiming it is for the remaining token amount. They guide the seller to scan it and enter their PIN to receive the payment!
Pro Tip
The 0-PIN rule: Remember, scanning a QR code and entering a PIN is the procedure to send money, not to receive it.
2. Forged Real Estate Regulatory Authority (RERA) registration and portal cloning
The Problem:
Scammers started fabricating RERA certificates to create fake project listings.
Mode of Operation:
- Document Forging: Scammers use Artificial Intelligence or professional editing techniques to create Commencement Certificates (CC) to get a RERA registration number.
- Portal Cloning: They create websites that look exactly like MahaRERA or UP-RERA. On this fake site, they make a page for their scam project. They give it a fake RERA registration number and mark it as approved. While the property enquiry is in progress, the scammer sends the link to the clone website directly to the buyer’s WhatsApp. When the buyer clicks the link, they see a page that appears to be a government website page showing the project is verified.
Pro Tip
If a builder sends a link to verify their RERA status, ignore it and manually search for the official RERA website in your browser.
3. The "digital arrest" and property liquidation scam
The Problem:
Scammers use video-calling technology to force property owners into selling their homes or plots under the fear of "legal clearance."
Mode of Operation:
- The Allegation: Scammers impersonate CBI or Mumbai Police officers via video call. They claim the call receiver’s ID has been used in a money-laundering or drug case.
- The Arrest: They place the victim under "Digital Arrest," which keeps the victim on camera for hours or even days. They use fake police station backdrops to make it look authentic.
- The Liquidation: They tell the victim that their assets are corrupt. The scammers pressured the victim to sell their flat or plot immediately and transfer the money to a ‘safe account’.
Pro Tip
Indian law enforcement will never investigate anyone via WhatsApp video calls. There is no such thing as "Digital Arrest".
4. Fake bank auction listings
The Problem:
Scammers use high discounts to attract buyers. They list luxury properties at a 30-40% discount, claiming they are part of a bank's recovery process.
Mode of Operation:
- The Bait: High-quality social media ads feature stolen or AI-generated photos of luxury apartments in prime locations.
- The Proof: Scammers provide forged Bank Allotment Letters and No Objection Certificates (NOCs) to prove that a bank is auctioning the property.
- The Theft: They ask the buyer to pay an Earnest Money Deposit (EMD) or processing fee. Instead of an official bank account, they ask for the transfer via a personal UPI ID or a private account.
Pro Tip
Official bank auctions are only conducted through the Indian Banks Auctions Mortgage Properties Information (IBAPI), ibapi.in portal.
Red flags in online property listings
Observation is the key to escaping from a scammer’s trap. This section explains what to observe before committing to any property deal.
Price difference
If a property’s price is significantly lower on a specific website in comparison to others and the market rate, it could be a scam.
Originality of photos
Check the photos of the listed property. Stolen photos usually have watermarks from other real estate firms or look very generic.
Urgent deal
No one will buy or sell a property immediately. If someone uses phrases like “only today,” “closing soon,” or “5 other buyers are ready with the cash,” the only aim of these conversations is to create unnecessary urgency and let the buyer or seller make the money transaction fast.
No RERA ID
Since 2017, the RERA (Real Estate Regulatory Authority) number has been mandatory for any project listed in the market. If a project does not have a verifiable RERA number, don’t proceed with the deal.
Fraudulent payment and booking requests
Caution is the best way to avoid scams. Think twice before making any payments. Check the points below to ensure the safety of any transaction.
Visiting pass payment
There is no visiting pass or gate pass to just visit a property in person. If anyone asks for these, consider it a signal to end further discussion.
Unverified bank accounts
A real estate company must hold a corporate bank account or an escrow account (a temporary holding account managed by a neutral third party for funds). This has been made mandatory by RERA since 2017. If the builder or the company involved in the property transaction doesn’t have any of the above-mentioned account formats, reject them immediately.
Cash transactions
The maximum limit for any cash transaction in India is 2 lakh rupees per day. This means that if any property dealer asks for a cash transaction above this limit, it is illegal and potentially fraudulent.
How to verify property details online
Verifying property details online is essential before making any purchase decision. Below are some quick checks anyone should do before making a purchase.
Verify the RERA ID
As said, every property should have RERA registration ID. If the ID is available, verify its authenticity on the relevant RERA website (e.g., MahaRERA for Maharashtra, UP RERA for Uttar Pradesh). This will show the construction status and any pending litigation.
Google Maps street view
This is a clever technique to verify the authenticity of the claims made by the builder or the property dealer. Do check the street view of the project or property on Google Maps to confirm the project is physically located at the site.
Online reputation of the builder
Verifying the builder's reputation is mandatory. Search in a browser for the builder's name plus complaints or reviews. This activity helps identify customers' real-world experience with the particular builder. Or search on platforms like Reddit, consumer court forums can help to find honest reviews from people who already dealt with the builder.
Steps to avoid online property scams
Taking necessary precautions is the best way to avoid online real estate scams. Follow the steps below to safeguard yourself from these scams.
Control over the money
Never pay a single rupee before visiting the site and checking the original documents.
Verify the documents
This is a very important step before making any property deal. The builder must provide the Title Deed, Encumbrance Certificate (EC), and Occupancy Certificate (OC). Verifying these certificates against the Sub-Registrar’s office records helps in understanding the property’s true status.
Friends and family
If the buyer is not currently in the location but still wants to buy a property there, seeking assistance from family or friends can help them avoid fraudulent deals. A single site visit by a family member or friend helps verify that the office and property are real.
Frequently asked questions
What is online property fraud?
Online property fraud is a cybercrime in which scammers steal money from buyers or sellers by making illegitimate property deals. Scammers do this through digital platforms such as listing sites, WhatsApp, or fake property websites.
What are common red flags in online property listings?
Common red flags in online property listings include a significant difference in quoted prices, no RERA ID, watermarked or stock images, and high-pressure tactics to make the payment.
How do online real estate scams work?
There are many ways scammers use to deceive buyers or sellers to get into fraudulent deals. Sometimes scammers pose as a high-trust individual (NRI, Army Officer) and provide proof like fake ID cards. Another trick is to ask for a fee for just visiting the site. People also report scammers ghosting them after they have paid.
Is it safe to make property payments online?
It depends on who you are dealing with while buying or selling properties online. The only way to make the deal safe is to take precautions. Check RERA-approved channels and official bank accounts of the builder.
How can buyers verify property details digitally?
Buyers should always verify property details through official government portals before making a decision. You can use the RERA website of the respective state to check the project’s registration, sanctioned plans, and construction progress. You can check land records such as Bhulekh (Uttar Pradesh), Bhoomi (Karnataka), or other state-level records online to confirm the actual owner's name. Checking the digital Encumbrance Certificate (EC) on the sub-registrar’s website is also a good way to see if there are any pending loans or legal disputes on the property.
What steps should be taken to avoid online property scams?
The best way to avoid these scams is to never pay any money before a physical site visit. Never pay for "visiting passes" or "token amounts" to see a property. You should also remember that you never need to enter a UPI PIN or scan a QR code to receive money. Always check if the builder’s bank account is a RERA-registered escrow account. If you are not in the city, ask a friend or family member to visit the office and the site to confirm they are real.
What legal action can be taken against online property fraud?
If you are cheated online, you should immediately report it on the National Cyber Crime portal (cybercrime.gov.in) or call 1930. Reporting it quickly helps the police freeze the scammer's bank account. You should also file an FIR at your local police station for cheating and forgery. If the fraud is committed by a builder, you can file a complaint with the state RERA authority or the Consumer Court to get your money back and seek compensation.
