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HOUSING

How to avoid fraud in the Stockholm house-hunt

With apartments in Stockholm harder than ever to find, desperate house-hunters are easy prey for con-artists. The Local’s Oliver Gee finds out more about how the fraudsters operate and how to avoid them.

How to avoid fraud in the Stockholm house-hunt

Experts labelled the Stockholm housing crisis in August as worse than ever before, and according to the Stockholm Chamber of Commerce there is a shortage of 73,000 homes in the Stockholm region.

Foreigners and Swedes alike have been fighting one another to claim their own space in Sweden’s capital, and the situation is particularly critical among students, not least at this time of year as new courses begin.

People are getting desperate, and this is where the con-artists feed, luring people into believing they’re getting an offer that’s too good to be true.

I found myself in the same situation recently. While surfing Blocket.se, the Swedish buy-sell website, I came across an advert that spoke my language (quite literally, it was in English).

I responded immediately and the seller told me to call a Skype account with a name that reeked of falsehood.

When I rang, a woman explained how she was happy to rent me her fifth floor apartment which was “conveniently close” to a Stockholm university. But, she was in Aberdeen, Scotland, so a meeting or a house inspection would be impossible, she said.

Even though alarms were ringing, and her Scottish accent was worse than Mel Gibson’s in Braveheart, I pushed on, eager to see where the fishiness would lead.

But as more and more unbelievable details emerged about how she acquired an apartment in Stockholm, and why she was renting it out, I lost interest.

Furthermore, a quick Google-maps check of “her” apartment showed that there wasn’t a fifth floor at all, and that windows in her pictures didn’t match the ones of the building. I ended the conversation with a thanks, but no thanks.

However, there was no actual proof that the woman was lying, so I asked my girlfriend to go through the routine too, in the guise of a potential exchange student from the UK.

“Where in the UK are you?” the woman asked somewhat cautiously, to which my girlfriend replied: Edinburgh.

On hearing this, the woman paused, then said she was from Liverpool, and assured my girlfriend that she “was a completely trustworthy woman and would never lie to anyone” and could my girlfriend please transfer the rent without asking so many questions if she wouldn’t mind very much.

With this, I confronted the fraudster, and after a time she confessed to being in Egypt. Foiled, the woman made a last ditch attempt to enlist me as her Swedish sidekick in the scamming process before I broke off the conversation.

Sure, sounds like a typical scam, but not every trap is so easy to avoid. An acquaintance of mine, a 23-year-old university student from Uppsala called Frej*, wasn’t so lucky.

“I lost 15,000 kronor ($2,250) to a con-artist. For a student, that’s a lot of money… especially when you know you won’t get it back,” he said.

Frej explained that his trap was more complicated. The fraudster stole the identity of a Swedish person, posted the address of a real apartment on Blocket, and asked Frej to transfer the money online via money transfer service Internetgirot.se.

Incidentally, this – entirely legitimate – website exists to reduce the risk of fraud when paying or receiving a payment in advance.

“The man told me that the money wouldn’t go through until we both confirmed it. When it was time to confirm, I got a message which I thought was from the service and I transferred the money.”

However the message said that the company was having “technical problems”, and asked if the money could be transferred to a separate bank account.

Believing the contents of the message, Frej transferred the money, but never heard from the “landlord” again.

“Afterwards I called the Nordea bank where I’d sent the money and when I told them the man’s name they said ‘Oh God, he is a scammer, call the police, call the bank!’ He had apparently done the same trick recently,” the student explained.

“I had an anxiety attack – I freaked out. The man had a Swedish name and was speaking Swedish… I’d heard of scammers from abroad but not from here in Sweden. I didn’t realize the lengths they go to in order to trick people.”

As it turned out, the scammer had sent him a fabricated email (also known as a spoof email) from the InternetGirot website, which looked exactly the same as their normal messages.

“I had actually done a lot of background checks on the guy. I just shouldn’t have sent the money to another account – I later learnt that the money transfer service would never send out such an email,” Frej explained.

Carl-Henrik Somp, the PR manager of the Trustly Group that owns InternetGirot, explains that these spoof emails happen “every now and then”.

“It’s a real shame for the people affected – the fraudsters push desperate people into making snap decisions in a market where competition is high,” he told The Local.

“The most important thing we can stress is that people should never transfer to an account that’s not ours – the correct information is stated on our website – no matter what fraudsters claim. Don’t ever click any links in emails and always type in our address manually – internetgirot.se – otherwise you can be stung by fraudsters.”

“Our site explains very clearly at the top of the homepage that money should only ever be transferred to our bank giro account. We are not involved in any other account number, no matter what you may be told.”

While the company does assist victims in filing a police report, Somp explains that once money has passed hands it can be tricky to ever see it again.

“Often the con artists will transfer it further to a second, third, fourth bank account. It’s easy for the police to trace the first bank account, but it is harder to get the money back since its often transferred to another account.”

Frej, meanwhile, still hasn’t got his money back, after long waits with what he referred to as “unhelpful” police and bank staff members who were “lacking initiative”. The police even had a suspect, according to Frej, but refused to release the man’s real identity.

“The worst thing is the feeling of betrayal,” he said.

So how can someone be sure that they’re not getting fooled?

Jarl Jönsson, an advisor at the Swedish Tenants’ Association (Hyresgästföreningen), explains that the key is to be extremely thorough, no matter how desperate you are.

“Always go to the house and be sure there is an apartment there to begin with. While you’re there, check if the owner of the building’s name is in the lobby, it’s a good idea to call them and be sure the would-be landlord has permission to rent it,” he told The Local.

“And before you give any money, also be sure to actually talk to the landlord.”

Jönsson warns that the fraudsters are most active at the start of university semesters.

“This time of year is the worst, the school term starts and many people are on the move. You’ve got to be careful and even if you’re desperate – never give money when someone asks until you’re completely certain it’s a legitimate deal.”

Meanwhile Frej, while admitting he was perhaps not careful enough, acknowledges that it was his desperation that eventually separated him from his money.

“It’s true that it’s also partly my fault, but you can help being desperate in this city,” he said.

“I sent hundreds of emails, got three responses, and two of them were saying no. When I saw the one chance I got I jumped for it. I was so grateful for the opportunity that I didn’t think twice,” he told The Local.

“It’s a mistake I definitely won’t make again, but a truly expensive lesson to learn.”

*Frej is not the real name of the student who was conned.

Oliver Gee

Follow Oliver on Twitter here

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OPINION & ANALYSIS

OPINION: Sweden’s ‘historic investment’ has failed to solve the housing crisis

Five years after Sweden's government promised to solve the country's housing crisis with a "historic investment", things are as bad as ever, David Crouch argues. Radical action is needed.

OPINION: Sweden's 'historic investment' has failed to solve the housing crisis

Forced to move house 20 times in the past eight years, Maria’s situation was desperate. She and her daughter had arrived in Stockholm from Latin America in search of a better life. She found work, no problem – but housing was impossible.

“Sometimes I was paying 12,000kr in rent and it was very hard because I only had 15,000kr in monthly salary,” says Maria (not her real name). So she took a high-interest loan of 240,000kr and tried to bribe someone in the Housing Agency to get to the front of the queue for affordable housing.

But she was caught. Her fate is unknown. And she didn’t even get an apartment.

This recent story, in the excellent newspaper of the Tenants’ Association, sums up the problems facing people who move here to work. The market for rental accommodation is tight as a drum. Finding a home means competing with Swedes, but with all the disadvantages of being an outsider. So people find themselves pushed into short-term, insecure rental contracts at inflated prices.

It wasn’t supposed to be this way. Five years ago this month, the government announced a “historic investment in housing”, including subsidies for construction companies, easing restrictions on building permits, and making more land available.

The housing situation at the time was grim. Spotify had threatened to leave Sweden if things didn’t improve – how could the company attract skilled young people to a city where there was nowhere for them to live? More than half Stockholm’s population – 600,000 people – were in the queue for a coveted rental apartment, because strict regulation meant these rents were low. But it took as long as 20 years to get to the front of that queue.

The result was a thriving rental property black market, with large bribes changing hands. Many tenants exploited the situation by sub-letting their homes, or parts of them. “It is almost impossible for immigrants and new arrivals to penetrate this market – it is all about who you know and how much money you have,” said Billy McCormac, head of the Fastighetsägarna property association, in 2015.

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So what has been the outcome of the grand promises the government made five years ago? House-building at the time was already rising steadily, and it has continued to do so. Look around you in the big cities and you will see that new apartment blocks have sprung up here and there.

But we shouldn’t go only on appearances. To understand the reality, we need to look at some numbers.

The gap between demand for housing and the existing housing stock has indeed started to shrink. “As housing construction has gradually increased and population growth has begun to slow down, the gap has decreased since 2017,” Stockholm’s Housing Agency noted in December.

The Agency has broken records four years in a row for the number of rental homes it has provided. The proportion of young adults living independently has also increased somewhat, the Tenants’ Association found, probably due to the pace of construction.

But this smidgen of good news is outweighed by an avalanche of bad.

The average queuing time in 2021 for a Stockholm apartment was more than 9 years; for somewhere in the city centre you have to wait 18 years. Only 936 homes came with a waiting time of less than one year. More than three-quarters of a million people are now registered in the queue for housing – a big increase on five years ago.

The rate at which the housing shortage is shrinking is nowhere near fast enough to alleviate the huge accumulated demand.

Assuming that the current pace of construction can be maintained, it will be the end of this decade before any significant dent is made in the deficit of homes, according to Boverket – the Swedish National Board of Housing, Building and Planning. The current rate of construction is “only marginally more than the long-term need”, it says.

The challenge is even greater when it comes to producing affordable housing, Boverket says, especially for the young and those entering the housing market for the first time. Almost one in four young Swedes up to the age of 27 are forced to live at home – the second-highest figure since the measurements began.

There are already signs that housing construction is actually slowing down, owing to higher building material prices, rising interest rates and an incipient labour shortage. Construction prices rose by more than 8 percent last year, and there is concern in the industry that war in Ukraine will further affect costs, in turn slowing the pace of building.

There is another fly in the ointment, a consequence of the collapse of Sweden’s governing coalition in November. The new, minority administration was forced to adopt the opposition’s budget, which halted investment subsidies for house building, throwing the construction industry into confusion.

In short, the “Swedish model” for providing people with a roof over their heads is failing. The folkhemmet, or “people’s home”, has not enough homes for its people.

Swedes themselves understand this: in a survey last month, nine out of ten voters said they thought that politicians did not take the housing shortage seriously.

We have waited too long. It is time for fresh thinking and radical action to solve the housing crisis.

David Crouch is the author of Almost Perfekt: How Sweden Works and What Can We Learn From It. He is a freelance journalist and a lecturer in journalism at Gothenburg University

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