Housing affordability is usually framed through numbers: mortgage rates, housing supply, construction costs and zoning restrictions. Washington debates the numbers, and families feel the squeeze. But there is another housing cost hiding in plain sight—real estate fraud.
With Congress working on bipartisan housing solutions and the State of the Union address just around the corner, it’s encouraging to see housing affordability taking center stage, and I commend policymakers and the Administration and for prioritizing it.
But affordability cannot be measured only by what appears on a spreadsheet or mortgage payment. It must also reflect whether homebuyers and homeowners are protected from risks that can derail their financial future.
Real estate transactions have become a prime target for increasingly sophisticated criminal schemes. Wire fraud, identity theft, forged deeds and seller impersonation scams continue to evolve, and their impact can wipe out a homebuyer’s life savings or create legal chaos long after the keys are handed over.
The FBI reported nearly $175 million in losses from real estate-related fraud in 2024. That figure is staggering on its own, but it still doesn’t capture the full toll of the time, legal expense and emotional distress families face when they discover that someone has stolen their money, hijacked a transaction or tried to claim ownership of their home.
For most Americans, buying a home is the single largest financial decision they will ever make. It’s the centerpiece of the American Dream. But that dream can quickly become a financial nightmare if a homebuyer is left exposed to fraud they can’t reasonably detect or prevent on their own.
That’s why the consumer protection infrastructure that safeguards homeownership, wealth building and the integrity of every real estate transaction in America is so important. Without expert title professionals working behind the scenes to examine property records, identify risks to ownership and working to stop fraud, homeowners face greater risk of buying a home that quickly becomes unaffordable.
The goal is straightforward: when someone buys a home, they should actually own it free and clear, without hidden claims or legal disputes waiting in the background. And if sophisticated criminals commit fraud, title insurance provides coverage for that risk.
Cost of fraud
That protection matters because the costs of fraud are not small. The average fraud claim exceeds $143,000, and refinance-related fraud claims average $207,000 — far beyond what most homebuyers and homeowners can absorb. These losses can erase years of savings and leave families facing expensive legal battles to protect what they believed they had already purchased.
As the Administration and Congress prepare to pursue additional housing priorities in the weeks ahead, affordability will remain a major focus. Any serious effort to expand access to homeownership must include a clear-eyed assessment of risk. Efforts to address affordability cannot come at the expense of the safeguards that protect homebuyers and lenders.
When safeguards are weakened, the consequences don’t disappear — they shift to consumers. A homebuyer may lose their homeownership dream. A homeowner may face court battles over forged documents or stolen identities. These are not abstract risks; they are real costs borne by real families.
And those costs aren’t isolated. Over time, increased fraud risk affects the broader housing market: Lenders tighten credit, rates rise to reflect uncertainty and first-time homebuyers often pay the price.
A housing system that can’t protect consumers from criminal activity is not a system that will remain stable, trustworthy or accessible. This is why fraud prevention is not a side issue in housing policy. It is a core affordability issue.
The path forward should not be a choice between affordability and protection. Americans need both. Housing policy should strengthen the guardrails that keep transactions functioning smoothly and help ensure families can pursue homeownership without being blindsided by hidden fraud risks.
Behind every closing is a set of safeguards most people never think about until something goes wrong. Washington should ensure those safeguards remain strong, because protecting the American Dream means protecting the people striving to achieve it.
Chris Morton is CEO of the American Land Title Association (ALTA).
This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.
To contact the editor responsible for this piece: tracey@hwmedia.com
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