The Privacy Commissioner is cracking down on privacy breaches by landlords after tenants were ordered to produce bank statements to secure homes or placed on secret "blacklists".
Privacy Commissioner John Edwards announced he will focus on the collection, retention and disclosure of information by landlords and property management agencies after his office received a raft of complaints.
Edwards said he was aware some property management agencies and landlords were asking for very detailed information from tenants during the selection process, while others used public forums to compile lists of so-called "bad tenants".
Such "blacklists" lacked transparency and could unfairly keep some tenants out of the market because of inaccuracies, Edwards said.
"I am concerned about some of the practices we are seeing, particularly during a time when pressure on tenants is high."
Demand for rentals across the country had led to prospective tenants competing for fewer properties, making them vulnerable to requests for personal information that went beyond what was necessary.
A Herald report in 2018 revealed some landlords were demanding copies of prospective tenants' bank statements, a move that was denounced as "unethical".
Auckland-based property manager Rachel Kann told a 2018 social services select committee she routinely asked for bank statements.
"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," she said at the time.
"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, McDonald's, the dairy, KFC, McDonald's, court fine', trucks that they buy, goods that they can't afford. You know, I see a lot of mismanagement of money."
An MP on the committee labelled the comments a "gross invasion of privacy".
Requesting information regarding a tenant's nationality, marital status, gender or detailed banking history was almost never justified, Edwards said.
"Landlords are able to collect information to assess whether a tenant can pay rent, however, collecting their bank statements to gauge how they spend their money is unfair and unreasonably intrusive.
"Landlords should only collect the minimum amount of personal information necessary to make that decision."
Landlords and property managers also needed to be open about why they were collecting information and how it would be used while ensuring any personal information they did hold was stored and handled securely, Edwards said.
The Privacy Commissioner released a new set of guidelines in 2019 outlining what information landlords can collect.
Things like pet ownership, expected length of tenancy and whether tenants smoke or not could be asked about, but details like nationality, marital status, employment history and what rent the tenant paid in the past shouldn't be collected.
The Privacy Commissioner's announcement comes ahead of the biggest tenancy law overhaul in 35 years, which comes into force this month.
Under the new reforms, landlords will be able to increase rents only once every 12 months, rent bidding will be banned and so will no-cause terminations, where landlords can kick out tenants with 90 days' notice without having to provide justification.