What kind of personal data is normally being processed in the renting sector and how critical are the processings?

The renter-tenant relationship may be divided into different phases that all require the processing of personal data about the tenant.

It starts with the selection of potential tenants: To cope with the high demand of living space in popular areas, landlords understandably wish to conduct a preselection of sometimes many hundreds of interested persons. The more detailed the information about the potential renter, the easier the preselection. From the landlord’s perspective, there is almost no information that could not be of relevance for the preselection.

However, while some data may be considered crucial (e.g. information about the approximate income to draw conclusions about the renter’s financial stability) other data such as hobbies or family status will regularly be of less importance for a well-founded decision.

The more crucial the information the higher the landlord's need to verify its correctness before offering the renting contract to a selected candidate. This often requires the involvement of third parties such as credit agencies (proof of creditworthiness), employers (salary statement) or current landlords (rent payment certificate).

Once a suitable renter has been found, the carrying out of the renting contract might require the processing of consumption data (heating, water), to provide for a correct utilities statement.

Which privacy laws and provisions have to be respected in the renting sector?

The conflicting, often even opposed, interests of landlords and (potential) renters with respect to the processing of partly sensitive information about the renter’s financial circumstances and living preferences, regularly require a balancing of interests.

For an appropriate balancing, a clear distinction between "essential" and "non-essential" needs of the landlord regarding the selection of reliable and solvent renters must be established.

While it is, on the one hand, obvious that a landlord must be able to conduct criteria-based selections, the sensitivity of some of the information requested and the potential risks for discrimination and / or denial of existential living needs resulting from detailed renter profiling must also be taken into consideration.

In contrast, a balancing is of course not necessary where data is undoubtedly required for the fulfilment of the renting contract. This might apply (as the case may be) to contact and consumption data.

Which compliance risks must be considered and what has been the focus of supervisory authorities and courts?

If tenant data is not processed in accordance with the law, this can have a strong personal impact on the life of the (potential) tenant. This would be the case, for example, if the tenant is denied the right to rent a flat due to a negative credit report.

Against this backdrop, the processing of tenant data has already been the subject of various statements by authorities and court judgements.