Utah Dept of Commerce warns of vacant land scams

The Utah Department of Commerce’s Division of Real Estate is urging land buyers and owners to be aware of a recently re-emerged scam related to vacant lots and land parcels. The Division of Real Estate is already aware of at least 10 different instances and suspects others. 

The scam typically involves vacant land that is owned outright. A fraudster locates a property through public records, impersonates the owner, and lists the property for sale, usually as a FSBO (For Sale by Owner), for a price well below market value. Many of these false listings appear on third party property sites like Zillow, but the division has received word that more of them are being listed with brokerages to get the listing on a multiple listing service (MLS). 

“These kinds of scams are particularly harmful because they erode trust in the real estate market at a time when we want to encourage continued engagement in the economy,” said Department of Commerce executive director Margaret Busse. “But this scam shouldn’t deter anyone. It means buyers need to be extra careful with this particular type of listing.”

Because there’s often not a home or building on the property, the scammers typically present themselves as out of state. Communication is typically exclusively via email or text and the scammers push for a quick close, including the use of a remote notary and title service. It is not clear whether the notary is involved in the fraud or if the sellers are presenting false identification to represent themselves as the property owners.    

“Vacant lot or land parcel listings are an easier target for scammers because often there’s little reason to physically visit the property,” said Division of Real Estate Director Jonathan Stewart. “Without a building or home to walk through, scammers can post photos and more easily pretend to be the seller.” Even if a potential buyer does visit the property, there may be little or no evidence to cause the buyer to suspect that the actual owner is not the person who listed the property for sale.

To stay clear of this scam, Commerce recommends watching for the following red flags: 

  • The Listing involves vacant land (in rare circumstances, vacant condos) 
  • The seller is not in Utah, and may claim to be out of the country 
  • The seller will only sign documents remotely and will not have someone meet locally
  • The seller won’t provide detailed information about the property. Typically they are not able to provide information about Club Memberships, HOA dues, HOA transfer fees, utility charges, water rights, water shares, etc. 
  • The vacant land is being listed for well below market value   
  • The seller is in a big hurry to close
  • A seller acts aggressively or aloof 

In addition to buyers, the Division of Real Estate is asking agents to take extra precaution to avoid a land selling scam. If you are contacted about selling vacant land or if you are representing a buyer who is looking at vacant land, please do your due diligence and be certain the sellers actually own the property. 

  • Research the name of the seller and check their photo ID
  • Take additional steps to identify ownership of the land 
  • Ask specific questions about the property details

Those who find deceptive listings should report them to the listing site or the brokerage if there is one listed. Deceptive listings can also be reported to the Division of Real Estate at realestate.utah.gov