Real Estate Scams: The Dangers of Buyback Offers and Investment Deals
In the real estate market, new types of scams such as buyback offers and invitations for expressions of interest (EOI) are targeting home-buyers and investors, often leaving them financially and emotionally devastated. These schemes are illegal and often
Real Estate ScamsBuyback OffersEoiFraudInvestment DealsReal Estate NewsOct 14, 2024
According to regulations, it is illegal to collect money by offering buyback schemes or inviting expressions of interest (EOI) for real estate projects. Despite this, scammers continue to find ways to dupe people, especially in areas like Kokapet, where the modus operandi is well-defined.
Verification has revealed that dozens of such advertisements are circulating across social media platforms. Scammers use a variety of tactics to deceive potential investors, including sharing videos of non-existent projects and using 3D models of unrelated ventures.
B. Manohar, a tech professional, fell victim to one such scam. He was shown a 3D model of a high-rise building and promised a flat in a 30-storey project in Kokapet. He paid Rs 1.16 lakh, swayed by the urgency created by the scammers. “They made it seem like I would regret not acting immediately,” he said.
Another victim, a woman, was lured by a social media post offering a buyback deal “Invest Rs 50 lakh and get Rs 90 lakh.” She was convinced by the promise of high returns and ended up losing a significant amount of money.
Many victims prefer to remain anonymous and do not report the scams to the police due to concerns about their professional reputation. One victim, who manages a team of 150 people for a corporate giant, explained, “Lodging a complaint would damage my professional image.”
Some victims have sought help from the Telangana Real Estate Regulatory Authority (TGRERA), but they were turned away because the projects were not registered with RERA. This further complicates the issue, as it leaves victims with little to no recourse.
Most of the fraudulent projects are named after the locations, such as Nanakramguda commercial space, Kokapet residential apartment, and Mokila Villas. These names give a sense of legitimacy, making it easier for scammers to attract investors.
To protect yourself from such scams, it is essential to verify the authenticity of any real estate project before investing. Always check if the project is registered with RERA and seek legal advice if you have any doubts.
Frequently Asked Questions
What are buyback offers in real estate?
Buyback offers in real estate are schemes where developers promise to buy back the property from the investor at a higher price after a certain period. These offers often seem attractive but can be fraudulent.
Is it illegal to collect money through buyback schemes?
Yes, it is illegal to collect money by offering buyback schemes for real estate projects. These schemes are often used to dupe unsuspecting investors.
What should I do if I suspect a real estate scam?
If you suspect a real estate scam, gather all relevant documents and report it to the local police and the Telangana Real Estate Regulatory Authority (TGRERA). It is also advisable to seek legal advice.
How can I verify the authenticity of a real estate project?
To verify the authenticity of a real estate project, check if it is registered with RERA, review the project documents, and seek professional advice. Conduct thorough research and do not rush into any investment.
What are some common tactics used by real estate scammers?
Common tactics used by real estate scammers include sharing videos of non-existent projects, using 3D models of unrelated ventures, and creating a sense of urgency to pressure investors into making rushed decisions.
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