Beijing Reins in Rental Fraud in Apartment and Home-Stay Markets

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Thanks to the Internet, renting a room has never been easier. Apparently, it also has never been so easy to swindle unsuspecting renters with misleading posts and shady practices.

Local officials have previously taken note of landlords who illegally rent out rooms without proper approval or otherwise fall short of the law in their renting practices. Last year, an August crackdown cleaned up Beijing’s cheap-end hotel and hostel market, finding hundreds of rooms in violation.

In the digital era, however, enforcement can't rely on raids for everything. For instance, how can you raid a place that doesn’t actually exist? That is precisely the problem that many online platforms are struggling to deal with: fraudsters are posting listings for totally fake rooms. In an effort to abolish these so-called “zombie rooms,” a new Beijing policy has taken the fight to the cyber realm. According to the policy plan, Airbnb-type platforms such as Xiaozhu and Mayi will be required to block landlords who upload three or more fraudulent posts.

A typical Beijing home-stay room on the cheap

Some experts have speculated that the move is as much a signal to the market as it is a concrete regulation, meant to let landlords know that their crafty ways are not going unnoticed. Short-term or home-stay rentals aren’t the only ones feeling the pressure, either. Xinhua reports that 100 Chinese rental agencies have just pledged to combat common problems with long-term apartment rentals. That market, too, is fraught with fabricated listings and excessive or unfair fees.

The promise comes after a summer hot with debate on the subject of apartment rental policies. In June, a survey by China Youth Daily revealed that 82 percent of young people in China said that they felt heavy economic pressure from high rent prices, and 90 percent are troubled by the misleading advertisements and shoddy facilities found in the renter's market of today. Moreover, the summer saw netizens pointing to a new rule in Berlin, a city that has banned most rent increases for the next five years, and wondered why Beijing might not implement a similar policy. 

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Like many regulations in the world of e-commerce, the actual enforceability of this policy remains to be seen. A pair of reporters for Beijing News took it into their own hands to put these platforms to the test. Their investigative reporting found that uploading information about a non-existent room with a fake address managed to gain approval from two separate platforms within 24 hours. Of course, expectations must be tempered when dealing with online platforms. We can hardly expect these apps to keep a 100 percent and up-to-date list of all valid addresses in the city, and moreover, such false listings should be caught by user reports rather than being detected upon upload.

What’s more concerning is that the reporters were also able to falsify their identification information and still gain approval, even though that is something the platforms should be able to catch.

Nonetheless, the three-strike policy applies to more than just zombie rooms. In theory, any fraudulence should count against landlords on the platforms, including misleading photographs, failing to inform renters about broken facilities, or manipulating online ratings. Of particular concern are issues related to security, such as failing to register renters’ identification as required by law.

Unfortunately, theory and practice do not always meet eye-to-eye. In short, while pledges and regulations are nice to see, apartment hunters and travelers alike would be wise to exercise caution when renting in Beijing.

Photos: biv.com, Youtianxia

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