16 Nov 2017

What legislation impacts on the tenancy selection process?

Under The Property Occupations Act and Regulations – A property manager must act in the clients best interests and demonstrate due care skill and diligence.

Under The Privacy Act – When collecting personal information an agent/property manager must demonstrate they have complied with the 13 Australian Privacy Principles (13 APP’S).

Under The Anti Discrimination Legislation -  The owner/property manager must not breach discrimination legislation in the tenancy selection process.

Under The Residential Tenancies and Rooming Accommodation Act – The legislation states minors can enter into legally enforceable tenancy agreements. Property managers should not state that a prospective tenant cannot sign a tenancy agreement if they are not 18 years of age as this is incorrect and maybe perceived as age related discrimination. Normal commercial considerations need to apply when assessing if a prospective tenant has the capacity to pay the rent and meet the tenancy obligations.

Additionally, the Section 458A of the RTRA Act requires the owner/ property manager to disclose which tenancy databases they use to check the rental history of prospective tenants. This disclosure should be incorporated on the tenancy application and state the reason the relevant databases are used and how a person may contact the database operator and obtain information from that operator. Section 458B of the RTRA Act requires that if a prospective tenant is listed on a database the property manager must provide the tenant with a written notice within 7 days. The RTA website provides useful templates for the purpose of compliance with these sections.

Sections 12, 58, 60 and 61 of the RTRA Act impact on when a prospective becomes bound to a tenancy agreement once their application is approved. A tenant can either be bound once verbal acceptance of the tenancy application has been communicated to the tenant or before accepting an amount in relation to the tenancy.

What this means is if owners/ property managers legally bind a tenant based on verbal acceptance the tenant must have been given a completed Form 18a with all the standard terms and any special terms with the application form. The only items which would not be completed on the Form 18a would be Item 2 and Item 5.

Property managers who don’t verbally bind the tenant must provide the completed Form 18a (including Item 2 & 5) prior to accepting an amount in relation to the tenancy such as rent or bond. A best practice recommendation is for property managers to not only give the tenant the completed Form 18a prior to accepting monies but also provide the tenant the opportunity to read, understand and sign the Form 18a.



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