Not every red flag in a tenant application means you should reject the applicant, but each one deserves careful consideration. Knowing what to watch for -- and how to respond proportionately -- helps you protect your investment while remaining fair and compliant with Australian tenancy law.
Inconsistent Information
One of the clearest warning signs is information that doesn't line up. Watch for discrepancies between:
- Employment dates on the application versus the employer reference. If the applicant claims to have been at their job for two years but the employer says six months, there's a problem.
- Income stated on the application versus payslips or tax returns. Inflating income to meet the 3:1 ratio is one of the most common forms of application fraud.
- Previous addresses that don't match rental references. If the applicant lists a different address from what the previous landlord has on file, dig deeper.
- Different names or dates of birth across documents. While genuine errors happen, multiple inconsistencies suggest carelessness at best and dishonesty at worst.
When you spot an inconsistency, give the applicant an opportunity to explain before drawing conclusions. A typo or outdated document is very different from deliberate misrepresentation.
Reluctance to Provide References
A strong applicant will typically provide references willingly. Be cautious when an applicant:
- Claims they cannot provide contact details for previous landlords, especially for recent tenancies.
- Offers only personal references (friends, family) rather than professional ones from landlords or property managers.
- Asks you not to contact their current landlord. While there can be legitimate reasons for this -- such as not yet having given notice -- it should prompt you to seek stronger verification from other sources.
- Provides references that are consistently unreachable or whose voicemail greetings don't match the name provided.
First-time renters genuinely won't have rental references, so this red flag applies primarily to applicants who claim prior rental experience but can't back it up.
Gaps in Rental History
Unexplained gaps in a rental history can indicate periods of eviction, staying with friends or family after a tenancy ended badly, or even periods of homelessness. While none of these are inherently disqualifying, they warrant further enquiry.
Ask the applicant directly about any gaps. Legitimate explanations include:
- Travelling overseas or interstate for work or personal reasons.
- Living with a partner and not being on the lease.
- Staying in owner-occupied accommodation (living with parents or in a property they owned).
- Periods of study where they lived in university accommodation.
A gap with a reasonable explanation is far less concerning than one the applicant tries to hide or can't account for at all.
Poor Credit History Warning Signs
If you conduct a credit check (with the applicant's written consent), the following items are worth noting:
- Defaults. Unpaid debts that have been listed on the credit file. A single small default from several years ago is far less concerning than multiple recent defaults.
- Court judgments. If a creditor has taken the applicant to court and won, this indicates a serious level of debt avoidance.
- Bankruptcy. Current or recent bankruptcy is a significant concern for rent payment reliability, though a discharged bankruptcy from many years ago is less relevant.
- Multiple credit enquiries in a short period. This can suggest financial stress or "shopping around" for credit, though it can also reflect normal life events like buying a car or changing phone plans.
Remember that a credit check is only one piece of the puzzle. A person with an average credit score but an excellent rental history and strong references may still be a reliable tenant.
Handling Red Flags Fairly
Australian anti-discrimination law prohibits rejecting tenants on the basis of race, gender, age, disability, sexual orientation, marital status, pregnancy, religion, or receipt of government benefits. Each state and territory has its own legislation, but the protections are broadly consistent:
- NSW: Anti-Discrimination Act 1977
- VIC: Equal Opportunity Act 2010
- QLD: Anti-Discrimination Act 1991
- WA: Equal Opportunity Act 1984
- SA: Equal Opportunity Act 1984
- TAS: Anti-Discrimination Act 1998
- ACT: Discrimination Act 1991
- NT: Anti-Discrimination Act 1992
When you encounter a red flag, focus your assessment on factors directly relevant to the tenancy: ability to pay rent, history of property care, and conduct as a tenant. Document your reasoning for every decision, especially rejections. If you decline an applicant, your records should clearly show that the decision was based on legitimate tenancy-related criteria.
Abode's structured application workflow helps ensure consistency in your screening process. By evaluating every applicant against the same criteria and documenting each step, you reduce the risk of unconscious bias and demonstrate fair treatment if a decision is ever questioned.