WA rental reforms put property managers on notice over tenant information

The upcoming reforms to the Residential Tenancies Act 1987 (RTA) will regulate the information prospective tenants can be asked to provide.

For example, property managers and investment property owners will not be able to ask about:

• gender; names or ages of dependents
• citizenship status; visa expiry; student status; retirement status
• details of previous living history; current applications for other properties and previous involvement in legal action with a lessor
• rental bond history, bankruptcy status and bond rent assistance applications
• a statement for a credit or bank account showing daily transactions
• employment history (excluding current employment) or credit history
• any information about the prospective tenant that relates to one of the attributes protected by the Equal Opportunity Act 1984, unless the reason that the information is required is provided in writing.

The Western Australian government has based these limitations on a recent determination of the National Privacy Commissioner and the type of information that is prohibited from being collected in other jurisdictions.

While the aim of the aim of the reforms is to prevent discrimination, in Victoria’s experience, in practice they are implicitly discriminatory.

There, the reforms have reduced the application process to a purely financial consideration. Rather than allowing property managers to find the best tenant for the property, it has become a question of who can pay the most. The reforms particularly disadvantage vulnerable tenants, such as single mothers and Indigenous people.

Privacy versus reasonable right to know

Property managers know the best tenant isn’t necessarily the one making the highest offer.

Limiting the information they are allowed to collect will prevent them from finding the most suitable tenant for the property. It will also make it harder for property managers to support good tenants who may not be the strongest applicants financially.

Further, while REIWA is supportive of restrictions on the collection of information that is irrelevant to the application and tenancy process, WA property managers have an explicit legal obligation to their clients to recommend the best tenant from among those who have applied for the property. Restricting the questions they can ask conflicts with this obligation.

For example, visa expiry is necessary to establish whether the preferred tenant can stay in Australia for the duration of the tenancy. Knowing someone’s employment, living and bond history can indicate whether the tenant is likely to pay the rent for the term of the tenancy and take good care of the property.

Knowing the number and age of dependents ensures there is an appropriate number of people living in a home. For example, a couple with a baby may be suitable for a one-bedroom apartment. A couple with two teenage children is not.

As it will soon become more difficult for property managers and investment property owners to end challenging tenancies, it is particularly important they be able to make well-informed decisions at the application stage. By limiting the information available during the application process, the reforms will increase the risk of owners entering into tenancies that may ultimately prove unsuitable or problematic.

While REIWA and its members believe the proposed limitations will impact tenant selection and risk discriminating against vulnerable people, we strongly support the reforms’ aim to ensure the safe collection, storage and destruction of personal data.

This is something our industry takes very seriously.