Here's what property managers can ask for from tenants

Wednesday, 8 August 2018

Property manager Rachel Kann says she looks at spending habits to determine what tenants can pay.

Shweta Tomar recently applied for a new rental property and was asked to submit both her bank statements and payslips in support of the application.

'The agent wanted it all to see if we could afford the rent… I find it so uncomfortable, that level of detail we're sharing with someone just so they could ascertain we earn enough to afford rent.

'Also what I don't know is what they do with that information later on…since there's no privacy policy document that they sign they're kind of not held responsible for it. I feel there should be another way to verify our credibility without seeing our every detail of spending history, it's just too private.'

But she said she felt she had little choice because of the intense competition to find a nice house in Auckland.

* Twyford slams 'KFC test' for tenants**

It's not an isolated case - it was revealed today that one property manager told a select committee, hearing submissions on the bill that would stop letting fees, that she regularly asked for bank statements from tenants.

'I don't just want to put a tenant into a property and no sooner have they been put in they can't afford the rent,' Rachel Kann said.

'They're paying somebody's mortgage and I see a lot of people who are low socio-economic and their bank statements literally will read, 'KFC, McDonalds, the dairy, KFC, McDonalds, court fine', trucks that they buy, goods that they can't afford. You know, I see a lot of mismanagement of money.'

That prompted outrage from NZ First MP Darroch Ball, who said he thought it unfair that managers made judgements on how people spent their money,

At the moment, property manager is unregulated.

Until 2008, property management was an activity for which a real estate licence was needed, overseen by the Real Estate Institute. But when the Real Estate Agents Act came into force, there was no longer a requirement for property managers to be licensed.

Shweta Tomar worried what would happen to the information she provided in a rental application.

That means there's no clear rules around what they can of applications. But Consumer NZ says there's evidence many are asking for more than they need.

Here are some of the other things being requested from tenants:

A clean car

You won't find this in any rulebook, but lots of landlords and property managers suggest looking in a tenants' car to see whether it's tidy. This is taken as indication of how the house might be treated.

Payslips

Much like bank statements, payslips or a letter from an employer are used to determine whether people earn enough to pay the rent.

Proof of identification

Most applications require ID for at least one, and often all, the tenants. This is usually something such as a driver's licence or birth certificate.

Google search

Expect to have your Facebook account checked.

Property managers put potential tenants' names into Google, to see what turns up. Tenants who've been in the news for the wrong reasons could be eliminated.

Social media check

They'll also type tenants names into Facebook, at a minimum. If a potential renter has lots of photos partying or posts about money troubles, that will count against them.

A credit check

A credit check will show a property manager if the tenant has a history of defaulting on payments. Bad credit often stops applications being successful. But the new system of positive credit reporting means it's now possible to see some of the payments that are being made on time, which may help tenants who are on top of their bills.

The state of your car might not be top of your mind, but property managers might notice.

Tenancy Tribunal check

Landlords can check for Tenancy Tribunal orders on the Ministry of Justice website to find out whether the tenant has been involved in any disputes in the past.

References

Most want applicants to have references – sometimes three – from past landlords.