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REINZ welcomes Privacy Commission’s guidelines but …

Press Release – REINZ

When news of the KFC test first broke last year, the Real Estate Institute of New Zealand (REINZ) immediately called for some consistent standards to be put in place, therefore, broadly speaking, the Institute welcome the announcement from …22 May 2019
REINZ welcomes Privacy Commission’s guidelines but warns they may cause confusion

When news of the ‘KFC test’ first broke last year, the Real Estate Institute of New Zealand (REINZ) immediately called for some consistent standards to be put in place, therefore, broadly speaking, the Institute welcome the announcement from the Office of the Privacy Commissioner (OPC) that it has released some guidelines for landlords and property managers.

However, there are concerns around some of the discrepancies between what landlords may ask for under the Residential Tenancies Act (RTA) and what the Privacy Commission’s guidelines state. For example, Section 13A of the RTA requires a tenancy agreement to state whether a tenant is under the age of 18 – if landlords can’t ask a tenant’s age (almost never justified) or are unable to ask for a driver’s licence (almost never justified), then how will landlords ensure a tenant is over the age of 18?

Bindi Norwell, Chief Executive at REINZ says: “While we welcome the guidelines issued by the Privacy Commissioner, they are likely to cause confusion between landlords and tenants due to some of the discrepancies between different government departments. If these discrepancies aren’t resolved, then it may result in an increased workload for the Office of the Privacy Commissioner if tenants complain unnecessarily.

“On MBIE’s website, advice to landlords is that they can add extra conditions to the tenancy agreement if they relate to things that may damage the house or cause extra wear and tear for example not allowing the tenant to smoke in the house, yet the Privacy Commission’s guidelines state that asking whether a tenant smokes is only ‘sometimes justified’,” continues Norwell.

“Additionally, the Ministry of Social Development is still recommending to prospective tenants that ‘if you’re in paid work, ask your employer to give you a letter stating that you’re employed in a permanent or long-term job. Or, you could show your landlord your bank statement with regular income’ both of which fall under the Commission’s ‘almost never justified’ category.

“In the ‘sometimes justified’ category, reasons for leaving a previous tenancy is put in the ‘sometimes justified’ category – from a property management perspective this is not an unreasonable request and can actually end up working in favour of an applicant when they are looking at a property i.e. they were asked to leave as the property sold and they are wanting a long-term tenure for security reasons.

“Of concern is the suggestion that credit checks are ‘sometimes justified’. Landlords run a business and as part of that need to ensure tenants can meet their financial obligations. Most REINZ Property Management Members always performed a credit check as this is an expectation from landlords to ensure a person does not have a history of being unable to pay off debt. Failure to do this would potentially be negligent on a property manager’s part and could result in them losing the landlord’s business.

REINZ is disappointed that the industry was not consulted on these guidelines as the Institute would have been able to provide some valuable feedback to the Commissioner as to how some of these recommendations would work in practice.

“Going forward, we would welcome the opportunity to work with the Commissioner to help ensure the guidelines are effective and can work in practice,” concludes Norwell.

ENDS

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