Much like the homebuying process, renting an apartment is no longer restricted to scanning the newspaper for printed listings or driving around searching for signs. These days, rental websites and mobile apps like Zillow, Apartments.com and HotPads bring the options directly to apartment hunters.

Your time online doesn’t necessarily stop there, though. Renting is increasingly becoming more automated as property managers and landlords embrace systems and software that allow renters to apply for an apartment, sign a lease, pay rent and even submit maintenance requests online.

For both large apartment buildings with hundreds of residents and small buildings with part-time landlords who live off-site, these online processes help cut down on lag time and ease tension in the landlord-tenant relationship.

But leveraging the internet for apartment renting isn't all good for consumers, as scammers have found ways to take advantage of renters and landlords. What does each party in the leasing transaction gain from the newly automated processes, and how can both avoid becoming victims?

[Read: The 10 Best Apps for Finding Your Next Apartment.]

The Renter

From beginning to end, the online renting process becomes infinitely easier for a renter, who otherwise has to work with limited leasing office hours to pay rent and beat out competing renters applying for the apartment.

“As a renter myself, I’ve always been frustrated having to walk a paper rent check across town,” says Ryan Coon, co-founder of Rentalutions, an online platform for small and part-time landlords.

The benefits start early for renters using online tools. As they begin their search for a new apartment, the increased number of online listings helps renters get an idea of what's out there, especially in a national market that’s largely seeing low real estate inventory and increased competition for homes and rentals. A typical listing posted to sites through Rentalutions receives 15 leads for prospective renters within two weeks, according to Coon.

In June, credit bureau and risk information provider TransUnion released a survey of rental property managers that found more than 56 percent of respondents had experienced an increase in online applications in the past year. But even with the rising popularity of online options for renters, experts warn that other factors may be more important.

“[Online solutions are] a convenience, but I think that the other pressures in the marketplace really outweigh those considerations,” says Barbara Allen, managing broker at Elan Realty Group, a full-service real estate brokerage in Chicago that represents both tenants and landlords in the rental sector as well as buyers and sellers.

While landlords’ adoption of automated processes makes things easier for renters, Allen says high demand for apartments means renters often can't consider these features "must-haves." “The priority is simply locating an acceptable living space,” she says.

[See: 10 Ways Millennials Are Changing Homebuying.]

The Landlord and Agent

Landlords and real estate professionals who move their systems online benefit from having software specialized for their work, which trumps the individual filing systems and spreadsheets they used in the past.

“There’s just a ton more technology products to choose from, and certainly we’ve taken advantage of some of those, and so have our clients,” Allen says.

The market for landlord and property-management software continues to grow, with options for automated applications, background and credit checks, processing rent payments and fielding maintenance requests all easing the burden for renters who would otherwise have to write and deliver paper checks or place a call when a repair is needed.

Beyond that, landlords are now able to compare their available apartments with other communities online and adjust rent and community amenities to remain competitive. Though rents continue to climb as renters outnumber available inventory, landlords strive to remain among the top choices for apartment seekers, explains Mike Doherty, senior vice president of rental screening solutions at TransUnion.

“I think it’s driving them to compete in different ways for renters,” Doherty says, noting many property managers offer concessions for signing or renewing a lease, such as a moving allowance or a free month’s rent, and they are improving common spaces like fitness rooms and pools.

Caution for All Parties

But the battle isn’t just in the competition to win a lease – both renters and landlords have to fight against online scammers looking to take advantage of them.

The TransUnion survey found that nearly 70 percent of property managers are concerned about identity theft and online fraud when it comes to renting out space.

“For someone who can take an apartment without ever walking into the leasing agent’s – what’s [the landlord’s] fraud check?” Doherty asks. TransUnion’s Rental Screening Solutions division offers property managers services such as background checks and questioning suspicious applicants to try to weed out people looking to commit fraud.

Property managers and agents also need to keep an eye out for swindlers who are trying to trick renters.

“It’s actually pretty commonplace that fraudsters will grab and steal our online listing information and use that information in some sort of fraudulent advertisement,” Allen says, adding that many agents at her firm scan the internet for fake listings containing their information.

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For renters, the danger lies in renting an apartment that may not exist and putting their money and personal information at risk.

“One of the biggest unexpected things that we’ve learned in this space is just how much fraud and how many scams are out there really trying to take advantage of renters,” Coon says. “We make it easy for landlords to create rental listings for properties. We didn’t expect that people would actually try to use our site to try to create fraudulent listings.”

To combat scammers, Rentalutions has created an algorithm to help pinpoint suspicious content and keep it from reaching renters’ eyes. Coon says the company hasn't encountered any instance of fraud making it through their system in the past year. “We’re really trying to help make the process as transparent and as fair as possible for both the owner and the renter,” he says.

Renters can better protect themselves and their wallets from online apartment rental scams by remaining alert to suspicious questions and requests for money. While online applications and leases are convenient, always check out an apartment before you rent it. Even if you're relocating from another city, hire a real estate agent or ask a friend who lives nearby to visit the apartment and ensure the property isn't just real, but that it looks like the listing pictures. Ultimately, if a rental deal seems too good to be true, it probably is. Trust your instincts and don't sign a lease unless you feel confident.

Tags: real estate, renting, moving, housing, housing market


Devon Thorsby is the Real Estate editor at U.S. News & World Report, where she writes consumer-focused articles about the homebuying and selling process, home improvement, tenant rights and the state of the housing market.

She has appeared in media interviews across the U.S. including National Public Radio, WTOP (Washington, D.C.) and KOH (Reno, Nevada) and various print publications, as well as having served on panels discussing real estate development, city planning policy and homebuilding.

Previously, she served as a researcher of commercial real estate transactions and information, and is currently a member of the National Association of Real Estate Editors. Thorsby studied Political Science at the University of Michigan, where she also served as a news reporter and editor for the student newspaper The Michigan Daily. Follow her on Twitter or write to her at dthorsby@usnews.com.