Property Management General Manager Celia Burbery, discusses how Property Managers choose the best applicant for your property under the new Office of the Privacy Commissioner’s guidelines.
An important part of our role and one that our clients often ask us about is – how do we pick a tenant for their property? Initial tenant selection is very important to property managers, it can dictate the tone of the entire tenancy moving forward which can usually be for a 12 months fixed term. If we get it wrong, we are only buying a whole lot of trouble for our owners and ourselves, and nobody wants that. To reduce the risk of getting it wrong, we put a lot of resources into systems and processes that support choosing the best applicant for a property.
You may have heard about the ‘KFC test’ in the media, where last year a property manager requested a prospective tenant’s bank statements, and refused the tenant based on the amount of times KFC or fast food outlets were mentioned. This has caused the OPC (Office of the Privacy Commissioner) to release some new privacy guidelines. It is important to note that a prospective tenant can submit whatever documentation they wish to support their application, however a bank statement cannot be requested by a property manager. It’s important that property managers carry out due diligence on behalf of their clients – landlords, but the focus needs to be around ascertaining whether a tenant has stable employment and can pay the rent, not whether they spend their disposable income on KFC or Uber Eats.
Once a tenant has signed an application form giving us the authority to proceed with relevant checks, we proceed to capture information including reference checking and credit checking. These relate to tenancy matters and are not to be aimed at the prospective tenant’s general life history.
Based on the combination of these background checks, plus a property manager’s previous experience of finding tenants that meet the requirements of the property, we select the best applicant based on merit. Most of the time it works out very well however, sometimes we see what has been a great tenant at the initial selection process, and then during the tenancy they experience a major life event such as a job loss, marriage breakup, loss of a loved etc and these changes may unintentionally affect their tenancy behaviour at the time.
We work daily with our tenants to manage if these situations arise, ensuring all steps are taken to return to a rent-in-advance situation. We want to be compliant and compassionate, yet still be able to pick the best tenants for our properties so we can continue to meet the expectations of our clients.
General Manager – Property Management
Auckland Property Management
Contact us if you have any questions about the how we select the best property applicants on the form below.