Bad tenants face reputation scorecard

Renters are going to need to be a lot more careful about angering landlords after the launch of a ‘‘Tenancy Risk Score’’.

The score, which runs from zero to a supremely trustworthy 1000, is a parallel to the credit scores that lenders use to assess whether a prospective borrower is a good bet to repay a loan.

Created by Tenancy Information New Zealand (TINZ), a private company, the scores draw on 15 different sources of information ranging from credit ratings to Tenancy Tribunal orders and Interpol searches for criminals. Landlords can run a tenant check for about $15.

TINZ’S Ian Barker said the score would help landlords find tenants who posed a low risk of failing to live up to their obligations, including paying their rent on time.

And it’s not only individuals who are rated.

There were also company scores that landlords with offices, warehouses and shop buildings to rent can check.

Landlords have to get prospective tenants’ permission to check up on them.

‘‘This is typically via a privacy statement on the Tenancy Application form, which the prospective tenant fills out when applying for a property,’’ Barker said.

He said a good score was 600-1000 and a poor score was 500 or below.

The best way for a tenant to ruin their score was to get abusive towards their landlord, or get caught taking, or making, drugs in the house.

‘‘The worst things are antisocial behaviour such as verbal or physical abuse towards a landlord, drug use and unpaid rent,’’ Barker said.

‘‘The new Tenancy Risk Score is fairly harsh on those.’’

The average score across the database was 630, though scores would be generated only when a landlord made a check, so nonrenters would not have a score.

Each tenancy risk score is created using a smart algorithm designed to predict the likelihood of a prospective tenant being responsible person.

‘‘TINZ is able to generate a Tenancy Risk Score on any adult who authorises TINZ to do so. It’s generated in the same way a credit score is generated except with a bias towards tenancy risk,’’ Barker said.

People have the right under the Privacy Act to see the information TINZ holds on them, and insist on any inaccuracies being corrected.

Barker said there were around 400,000 rentals, and about 85 per cent of owners owned only one.

‘‘Our feeling is that most property managers do reasonable checks. Most private landlords seem to stop with verbal references.

‘‘Over the entire industry it seems less than 40 per cent use online checks.’’

But a lack of demand from tenants for an equivalent ‘‘Landlord Risk Score’’ meant it was unlikely TINZ would create one.

‘‘There is some demand but not enough,’’ Barker said.

‘‘Several years ago TINZ tried to help a group set this up by advertising it on TINZ’S website.

‘‘The simple truth with any tenancy is that the landlord is at greater risk than the tenant.

‘‘While the tenant may be subject to a sub-standard landlord who does not take their responsibilities seriously, tenants are able to move out or hold the landlord to account via the Tenancy Tribunal.’’

By contrast, a landlord was exposing his or her dwelling, often worth hundreds of thousands of dollars, to people they generally had no prior information about.