New Privacy Act guidelines – what landlords should know
The digital economy has brightened the spotlight on data, prompting regulators to explore protective measures for its collection and management. Now, the real estate industry is in the crosshairs of the Office of the Privacy Commissioner (OPC), which has instituted new guidelines that have important implications for vetting and selecting tenants.
Privacy Act 2020
Landlords and property managers must comply with the Privacy Act 2020 – legislation organised around 13 information privacy principles that govern the collection, storage, use, and disclosure of personal information (learn more at privacy.org.nz).
Most Goodwins clients will be aware that the OPC last year launched new guidelines to clarify expectations of landlords and property managers related to renters’ personal data. In short, the guidelines limit the amount of personal information a landlord can request to select a tenant. Landlords who fail to adhere to the guidelines will be fined.
The move in part reflects the size and importance of New Zealand’s rental sector – 1.6 million Kiwis live in a rented property – and that the legislation has remained unchanged since it was enacted in 1993.
OPC isn’t messing around
Changes introduced by OPC aren’t making things easier for landlords or property managers.
The regulator is conducting regular checks of rental sector agencies to ensure their processes accommodate these new requirements. They’ve also put new restrictions on data.
Forget about questioning prospective tenants about employment, schools, rental history, pets, or engaging in other chitchat designed to ensure a good match between property owners and tenants.
Only when prospective tenants have viewed a property can the letting agent legally ask for further details required to make a short list.
So, for example, a listed property might attract 40 or more applications, but the letting agent can only request the name and contact phone number of the applicant — that’s it, unless the applicant volunteers more information.
It’s a tough situation. Rather than having the opportunity to show through a smaller number of pre-vetted ‘probables’, landlords and rental agents are required to show the property to anyone who has expressed an interest.
It’s simply not practical.
Smart renters get it
Renters aren’t stupid. They understand that competition for housing is fierce and that landlords and letting agents make decisions based on information. Many enthusiastically supply information to make the letting process easier, which is entirely legal.
Also consider that renters looking for a property want to be notified when something suitable is listed. So, they figure there must be an exchange of information upfront to ensure the agent can provide a useful service.
Nevertheless, landlords and property managers must be cognisant of the new guidelines and the consequences of demanding personal information from prospective tenants when they first inquire about a rental property.
Start by reviewing your tenant application forms to ensure they comply with the new guidelines.
Privacy Commissioner – Rental Sector Guidance