MELBOURNE, Fla. – With affordable housing increasingly out of reach, tiny homes have surged in popularity - and so has tiny house fraud. A News 6 investigation found scammers are stealing images from a local manufacturer and using them to swindle prospective homebuyers out of thousands of dollars.
At Movable Roots in Melbourne, workers have been building custom modular homes for a decade. Now, crooks are trying to cash in on that success.
“They’re taking advantage of people not doing their due diligence,” said Mike Cheatham of Movable Roots.
Fake listings, real losses
Dozens of ads for tiny homes appear on Facebook Marketplace, and Cheatham says photos of Movable Roots’ custom builds are showing up there - and on fake websites - at rock-bottom prices.,
“This one is $129,000, and they will advertise it for like $40,000 and then people will be like oh my gosh, I can do that and they’ll say just a deposit for $5,000, and they will send them that $5,000 and they will never see the house,” Nikki Cheatham, the company’s Chief Marketing Officer, said.
When asked about a recent uptick in fraud, Mike Cheatham pointed to the broader housing crisis as a likely driver, though he acknowledged uncertainty.
“I’m not really sure. I believe it has to do with the housing crisis, right?” he said.
[WATCH: Man arrested after woman’s tiny home not delivered]
One victim’s story
Just last month, the News 6 Investigators reported on Kayla Morgan. According to arrest reports, she paid thousands of dollars for a tiny home that was never delivered - money she said was everything she had.
“That is a gut-wrenching hurt,” Morgan said.
“Because I mean not only does it hurt me, but it hurts my son,” she added.
Morgan’s case is far from unique. Fraud happens so often that someone started a Facebook group dedicated to exposing tiny house scammers. The group, which has hundreds of members, even maintains a list of what it calls “known scammers.”
Red flags to watch for
Just days ago, a website began advertising a “Nurses Model” tiny home for just $18,000. The company listed an address in Alabama but provided no telephone number - only a Gmail email address, which experts say is a red flag. News 6 emailed the company asking about the Nurses Model and had not received a response as of publication.
A reverse image search on Google Images traced that listing’s photo back to Movable Roots. The home is actually called “The Cat House” - and it is not $18,000. It retails for $165,000.
Cheatham also warned that an unwillingness to conduct a live walkthrough of the home is another major warning sign.
“Make sure that the company that you’re about to send your hard-earned money to has some kind of clout behind them that shows that they’re a legitimate company,” Cheatham said.