The problem of fake clients – why do people view houses they cannot afford?
There’s a very strange phenomenon in the real estate industry: clients who request to view exceptional properties (for exceptional prices) they cannot possibly afford to buy. We all like to daydream from time to time, but it isn’t polite or correct to waste working people’s time, not to mention inconvenience homeowners, so why do people do it?
I would not say it is an epidemic, but it certainly exists with properties at a certain price level and happens more often than most people would believe, to the extent both real estate agents and home owners can waste a lot of time and effort over the course of a year showing clients properties they cannot possibly afford.
The vetting process
It’s not rocket science. The standard procedure is to first undertake a thorough search on the internet regarding the client looking not just on Google but also in Social Media. If the client cannot be found, or is found and looks unconvincing, nine times out of ten there is a very good reason to be suspicious. Worse – if a representative of the client (who fails the criteria above), a supposed PA or agent contacts us to preview expensive houses on behalf of their boss/client there is a very high chance the client is fake – after all unless the client is Donald Trump most clients can find the time to view a property themselves. Proof of funds would seem the easiest method to eliminate fake clients until you realise that such documents can also be faked.
¨Most clients we have rejected return a few months (and sometimes years) later via another agent or source; fake clients never purchase so they can be in the market for literally years.¨
Of course some clients slip through the vetting process, sometimes it is impossible to obtain information on a client because of where they are from or because they are extremely private. Sometimes owners insist we give clients the benefit of the doubt. Some fake clients are convincing because they use information gathered from viewings with other agents to give you the impression they are well informed luxury property buyers. They also have a habit of asking for detailed information such as a floor plan of the guest house or photos of the view at night. Yet you ask, what about the shoe test, can’t you tell if someone has money by the state of their shoes? In our business it’s definitely not wise to judge a book by its cover and with more than 2,000 billionaires in the world and over 15m millionaire’s worldwide wealth has become a common commodity, the new rich are young and do not necessarily want to show it.
The dangers of believing in fake clients
Agents are particularly susceptible to the belief in the mantra ¨you never know¨. The client may not look like they have the money but on the basis that ¨you never know¨ the client is given the benefit of the doubt. This is particularly dangerous when the client is indeed a fake. I know of several cases where agents, lawyers and owners have been tricked in to believing (or rather wanting to believe) the fabulous offer they have received for their property is real. Not only is time and money lost, potentially real clients are lost since their offer is rejected as too low or they are prevented from seeing the property because it is under offer from a fake client.
The Walter Mitty Syndrome
So why do people do it? Clearly in some rare cases there must be a criminal intention but I would say 99% of fake clients do it for psychological reasons. To gain more clarity on this issue I spoke with Cristina Blanco, a qualified psychologist from Hallin Mental Care Marbella.
“From a psychological perspective there are a number of possible explanations,” explains Cristina. “Megalomania, or delusions of grandeur, is one possibility, and it occurs in people who believe they have, or deserve, a certain VIP status. Perhaps they feel they belong to an elite, or dream of being part of the jet-set, and somewhere along the way daydreaming and reality have become entwined. It’s often referred to as a Walter Mitty Syndrome, in which a person’s desire for a certain lifestyle begins to become a reality in their minds.”
A professional perspective
Such a person would want to see a luxurious villa because subconsciously they have convinced themselves they could possibly buy it. “Low self-esteem is another possible reason why a person who feels less worthy than those who have power and wealth would want to appear able to join them and buy a grand home, and in so doing feel a little closer and more equal to the people he or she looks up to so much.” Cristina explains that this kind of inferiority complex sees people making constant comparisons with others, and it shows a certain frustration with the state of their own lives. This provokes an inability to act and try to realise their dreams, and instead they live in a world of dreams that can manifest itself by acting out the role.
“It may just be curiosity, and while this is understandable, a person would have to have little in the way of normal social barriers to arrange a viewing just on the basis of that. But some do, and they believe it their right to be inquisitive in this way or simply while away a few hours by organising what are in fact fake property viewings.”
Whatever the drivers behind it, unfortunately until an app is invented that can detect fake clients it looks like we have to continue to sift the real from the wish it were real.
By Adam Neale | Property News | October 22nd, 2018