What Is RealPage? DOJ Sues Software Firm Using Algorithm Enabling Landlords to Fix High Rents

[Uncle Joe]

As sky-high rents and a housing shortage become major issues in the 2024 presidential election, the U.S. Justice Department has sued software company RealPage, alleging its algorithm enabled landlords nationwide to collude in raising rents on tenants. The DOJ says the price-fixing scheme has impacted millions of renters across the United States. ProPublica reporter Heather Vogell, whose investigation first exposed RealPage, says as much as 70% of big apartment buildings in some neighborhoods are owned by property managers using RealPage, with landlords seeing the software "as a way to have a rising tide that lifts all boats." We also speak with tenant rights organizer Tara Raghuveer, who says RealPage is guilty of "some of the grossest, most extractive business practices" documented in recent years, but the firm is hardly alone. "For so much of the market which is a catastrophic failure, landlords' business model is predicated on tenants' instability," says Raghuveer.

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[oldsoftie]

1. Why waste my money on RealPage? I raise my own rents.

I know what the area rents are for comparable homes & I ALWAYS rent below market. Thats how I keep long term tenants. Which to me is more important than staying at the peak rent. Regardless, I know what I COULD rent for, how does this company alter anything that I dont already know? I can make the rent whatever I want with or without them

[Uncle Joe]

2. You're more enlightened than massive corporations on Wall Street buying up residential properties to rent, and

when they share the same formula for driving rents up to the maximum it becomes price fixing.

Those kind of greed is good policies are turning residential America into a third world extractive country valued only for what wealth can be pulled out of it, while putting little or nothing back in.

Wall Street Is Buying Up Entire Neighborhoods

(snip)

As Wall Street buys up entire neighborhood blocks, driving up corporate purchases of single-family homes to historic highs, housing advocates warn companies like FirstKey are harming their tenants and pricing out would-be homebuyers. Now policymakers in states across the country and Washington, DC, are finally beginning to push back — but they’re facing the might of a powerful new single-family rental lobby.

Driven by the pandemic-era real estate boom, corporate landlords are ramping up their purchases of assets like apartment buildings and mobile home communities nationwide. They’re especially active in fast-growing Sun Belt markets like Phoenix and Atlanta, where more than a third of homes on the market are now being purchased by private equity firms like Blackstone or dedicated single-family rental companies. Even Amazon founder Jeff Bezos has entered the single-family housing market.

Critics say that such companies’ encroaching presence in the housing market and their focus on short-term profits are pricing out first-time homebuyers and gentrifying neighborhoods, contributing to an ongoing housing crisis and excluding families from the generational benefits of homeownership.

Wall Street, they warn, is an unaccountable landlord. Short-term rental companies have been sued for trapping their tenants with late fees and other surprise costs. Research has documented that corporate landlords file for more evictions than small-time landlords, which can permanently harm tenants’ ability to find housing in the future.

(snip)

https://jacobin.com/2024/05/single-family-homes-rentals-wall-street

[Gaugamela]

3. The point of the software is to create a kind of rent cartel that manipulates

the market to drive prices up across the board. The software is only effective if multiple landlords and property management companies use it in a given market. According to the video, software users sign onto agreements so that it becomes difficult to for them rent below the set amount even if they want to. This forces them to keep units vacant in order to support the elevated rent, but everyone (among the landlords) benefits in the end.

[oldsoftie]

4. In that case, sounds to me like something only an idiot would agree to.

Did Trump start it?
I mean I'm no land Barron but I have a few dozen properties & I see no advantage to this at ALL. If this program is telling me what to charge I'd NEVER sign up for it. Even keeping rents UP, if I'm forced to keep a unit VACANT that ruins any advantage from the higher price I get on others. Because I have an EMPTY one bringing in ZERO. 6 months empty at 1500$ a month is $9000 LOST income.
Also, insurance companies will drop you if you leave a home vacant for very long
I guess I need to read up on it to see why any landlord would think this benefits them when they can set rent for whatever they like right NOW.