The Greater Toronto Area (GTA) rental market is highly competitive, and unfortunately, that makes it a prime target for scammers. Whether you’re a landlord looking for reliable tenants or a renter searching for a place to call home, rental scams can cost you thousands of dollars if you’re not careful.
A shocking statistic from Menkes Development revealed that over 50% of rental applications contained fraudulent elements. Additionally, CBC recently reported that 35 victims in Kitchener-Waterloo lost a staggering $40,000 to rental scams. With numbers like these, it’s crucial to be informed and take the right precautions.
In this guide, we’ll break down How to Avoid Rental Scams in the GTA, how to spot red flags, and how you can protect yourself whether you’re a landlord or a tenant in Ontario.
Rental Scam Prevention for Landlords
As a landlord, you want reliable tenants who pay rent on time and respect your property. However, scammers can take advantage of landlords by using fake documents, fraudulent payments, and illegal subletting schemes. Here’s what you need to know.
1. Fake Documents Scam
Some prospective tenants submit fraudulent pay stubs, employment letters, or even fake credit reports to appear more qualified. In extreme cases, scammers use stolen identities or fake references.
How to Protect Yourself:
- Verify employment by calling HR through the official company website.
- Request a credit report directly from Equifax or TransUnion instead of relying on tenant-provided documents.
- Cross-check IDs and documents for inconsistencies.
2. First & Last Month Scam
Some tenants pay the first and last month’s rent, move in, and then stop paying altogether. Evicting them can take months and cost landlords thousands in legal fees.
How to Prevent It:
- Check rental history—past behavior can predict future actions.
- Look up eviction records through the Landlord and Tenant Board (Ontario).
- Require references from previous landlords, not just the current one (who may be eager to get rid of them).
3. Rent Rebate or Chargeback Scam
A tenant pays rent via credit card or e-transfer and then disputes the charge, reversing the payment after moving in.
Prevention Tips:
- Avoid credit card payments from unknown sources.
- Prefer e-transfers, certified checks, or direct deposits.
- Get a signed lease agreement and written proof of payments.
4. Unauthorized Subletting
Some tenants illegally sublet your property on Airbnb or Kijiji, charging higher rents while you remain unaware.
How to Avoid This:
- Include a strict “No Subletting” clause in your lease.
- Regularly check online listings for your unit.
- Conduct occasional inspections with proper notice.
5. Damage-for-Leverage Scam
A tenant may intentionally damage your unit and demand compensation or use it as leverage to break their lease early.
How to Protect Yourself:
- Take detailed move-in photos and have a signed condition report.
- Get landlord insurance that covers malicious damage.
- Document all communications in writing for legal protection.
6. Bounced Check or Fake E-Transfer Scam
Some tenants provide postdated checks that bounce or send fake e-transfer notifications that never deposit.
How to Avoid This:
- Verify payment before handing over the keys.
- Avoid postdated checks for the first month’s rent.
Rental Scam Prevention for Tenants
Tenants searching for rentals—especially in the GTA’s competitive market—are prime targets for scammers posing as landlords or property managers. Here’s how to protect yourself.
1. Fake Listings
Scammers steal details from real listings and post them as their own. They pressure tenants to send deposits quickly by claiming there’s high demand.
How to Avoid This:
- Use Reputable Platforms – Sites like Facebook Marketplace, Rentals.ca, and Kijiji are common places for fraud. Instead, use MLS and work with a licensed Realtor who verifies the landlord’s identity.
2. Red Flags to Watch For
Scammers often ask for money before showing the property or list rentals well below market value.
How to Protect Yourself:
- Compare rental prices – If a deal seems too good to be true, it probably is.
- Never send money upfront – Always see the unit in person before making any payments.
- Trust your instincts – If something feels off, walk away.
3. Verify Ownership
Some scammers rent short-term properties or book Airbnbs, posing as landlords before vanishing with deposits from multiple tenants.
How to Avoid This:
- Confirm ownership through tax records or government property databases.
- Ask for proof of ownership or work with a Realtor who can verify the listing.
4. Application Fee & Identity Theft Scams
Some fraudsters charge unnecessary application fees, credit check fees, or even key deposits before showing the unit. Others collect personal information like SIN numbers or banking details to commit identity theft.
How to Protect Yourself:
- Never pay fees upfront – Legitimate landlords usually collect deposits only after lease agreements are signed.
- Be cautious about sharing personal info – Only provide sensitive details after verifying the landlord’s legitimacy.
Bonus Tip: Document the Property’s Condition
Even if your landlord is legitimate, protect yourself by documenting the unit’s condition before moving in.
How to Do This:
- Take photos of every room and note any damages.
- Get the landlord’s written acknowledgment of existing issues.
- Keep all communication in writing for reference.
Final Thoughts: Stay Smart & Stay Safe
The GTA rental market is tough, and scammers are getting more sophisticated. As a top realtor in the GTA, I have seen many people fall victim to this since they acted without guidance. Whether you’re a landlord screening tenants or a renter searching for a new home, due diligence is crucial.
Landlords: Protect yourself by verifying tenant information, requiring proper payments, and keeping a watchful eye on subletting risks.
Tenants: Avoid scams by working with verified landlords, seeing properties in person, and never sending money upfront.
If you need help navigating the rental process, I’m always here to assist! Have questions or experiences to share? Drop them in the comments below or reach out directly.
