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renters
DOJ Files Rent-Fixing Lawsuit Against Corporate Landlords' Go-To Software Firm
"Today is a good day for renters and families and a bad day for predatory landlords," said one advocate.
Aug 23, 2024
Executives at the property management software company RealPage claimed they had the "greater good" in mind when they offered corporate landlords a price-fixing algorithm service, said the U.S. Department of Justice as it filed a lawsuit Friday against the firm—but the scheme allegedly drove rental costs up in communities across the country, contributing to the housing crisis.
The antitrust lawsuit, filed with attorneys general from states including California and Colorado, accused RealPage of using confidential data about its clients to algorithmically determine the highest price renters would pay, using its AI software.
U.S. Attorney General Merrick Garland and other officials said the company has violated antitrust laws by providing the service, which gives corporate landlords recommended rental prices and allows them to align prices with one another instead of having to compete.
Assistant Attorney General Jonathan Kanter said the lawsuit is "best understood in the words of RealPage's own executives," who have said the company's software allows landlords to "drive every possible opportunity to increase price, even in the most downward trending or unexpected conditions."
"RealPage tells landlords that it would prefer everybody succeeding versus essentially trying to compete against one another," said Kanter. "But that's not how free markets work. Competition among landlords, not RealPage, should determine prices for renters."
Garland added that "Americans should not have to pay more in rent because a company has found a new way to scheme with landlords to break the law."
As Common Dreams reported in June, RealPage and the corporate landlords that rely on it has come under the scrutiny of watchdogs including Accountable.US, which found that the six largest property management firms brought in a combined $300 million in increased profits in the first quarter of 2024, thanks largely to rent hikes.
The windfall came as rent prices have skyrocketed by more than 31% since 2019, while wages have gone up by just 23%.
RealPage's algorithm is alleged to have helped fix rent prices for about 16 million rental units across the country, said Accountable.US.
"Today is a good day for renters and families and a bad day for predatory landlords," said Lindsay Owens, executive director of the progressive think tank Groundwork Collaborative. "The Department of Justice is right to take on the affordability crisis that RealPage has been supercharging. Algorithms are being used to unfairly drive up prices for housing, meat, and more. This price-fixing must be stopped."
Caroline Ciccone, president of Accountable.US, said Friday's lawsuit shows that "the Justice Department sees evidence of a major rental price-fixing conspiracy by RealPage that extends to metro areas around the country."
"We've documented how many of the same landlord companies that were sued in the initial rent fixing lawsuit have boasted of massive profits after jacking up rents," said Ciccone. "Any property company that uses RealPage in one of these states should face a serious probe. No renter in America should be price gouged under a potentially illegal rent fixing scheme."
Accountable.US added in a social media post that "while rents soared, RealPage executives bragged about how their software could 'maximize' profits, even in the face of a housing crisis."
Andrea Beaty, research director for the Revolving Door Project, said RealPage's actions have "left tenants across the country paying the literal price of corporate greed, even in the midst of a global pandemic."
"This lawsuit will hopefully usher forth renewed corporate accountability in the rental market beyond RealPage, which is far from the only corporation capitalizing on tenant's struggles to live in safe and affordable homes," said Beaty. "We hope that in addition to the bipartisan set of eight state attorneys general suing RealPage, even more attorneys general will sign on in response to RealPage's actions to drive up rental costs in communities in their states."
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50+ Groups Demand Biden Go Further on US Housing Crisis
"With the Supreme Court decision to criminalize people who are unhoused, we need you to stand up and create more humane housing policies today."
Aug 13, 2024
In the wake of a U.S. Supreme Court ruling that is devastating for homeless people, over 50 organizations on Tuesday urged President Joe Biden to take immediate action to address the nation's housing emergency before his first term ends next January.
"We appreciate the steps your administration has taken to address America's affordable housing crisis," the coalition wrote, applauding his proposed 5% cap on rent hikes for tenants of corporate landlords and "regulatory actions to use public land for affordable housing, provide grants for deeply affordable homes, and require 30-day notice for rent increases and lease expirations."
Noting that Biden is not seeking a second term—Democratic Vice President Kamala Harris is set to face former Republican President Donald Trump in the November election—and the urgency of the housing crisis, the groups argued that "taking stronger action will resonate deeply with working and low-income people and people of color nationwide."
"Now is a critical moment for aggressive action to help end the worst housing and homelessness crisis our country has ever seen, help renters and houseless folks struggling with the cost of rent now, and set the country on a long-term path of providing safe, stable, and permanently affordable rental housing for decades to come," the letter states. "We, the undersigned, are calling on you to show leadership by using your executive authority immediately, to effect change now—during the worst housing and homelessness crisis of a generation."
"We must urgently create a more just and sustainable housing system."
Specifically, the coalition is calling for Biden to issue one executive order to establish an Office of Social Housing at the U.S. Department of Housing and Urban Development, and another for rent regulations and good cause eviction protections in federally insured properties.
Additionally, the groups want Biden to demand federal legislation supporting the right of all renters to organize and bargain collectively as tenant unions with landlords over rents and living conditions, along with appropriating $1 trillion over a decade to create 12 million permanently affordable homes, as well as $230 billion to fully repair and green existing public housing.
The letter—part of the House Every One! campaign—is led by the Center for Popular Democracy (CPD) Action and backed by groups including Stand Up Alaska, Make the Road Connecticut, Delaware Alliance for Community Advancement, Florida Rising, New Georgia Project, Step Up Louisiana, Maryland Communities United, Maine People's Alliance, Detroit Action, TakeAction Minnesota, New York Communities for Change, One Pennsylvania, Texas Organizing Project, and Our Future West Virginia.
As part of the campaign, "during the month of August, thousands of renters and community groups across the country will host local town hall meetings to call on their local and national representatives to crack down on corporate landlords, cap rents, and invest in tenant-owned, permanently affordable green social housing," CPD said in an email Monday.
The coalition wrote to Biden Tuesday that "we must protect families from the looming threat of unprecedented homelessness and displacement; halt Wall Street speculation and corporate landlords' growing influence over the housing market; create truly affordable green social housing; and redress our federal government's history of institutionalized bias, putting us on a path towards greater racial, economic, and gender equity."
"We all deserve a safe, stable, and affordable place to call home," the letter says. "We must urgently create a more just and sustainable housing system."
The letter also stresses that "with the Supreme Court decision to criminalize people who are unhoused, we need you to stand up and create more humane housing policies today, nodding to the City of Grants Pass, Oregon v. Johnsonruling. The right-wing justices ruled that local governments can enforce bans on sleeping outdoors, regardless of whether they are able to offer shelter space.
Some Democrats are under fire for welcoming the June ruling—including California Gov. Gavin Newsom, who is widely believed to have presidential ambitions. Since the decision, Newsom has issued an executive order directing officials to clear out homeless encampments, participated in clearing of a Los Angeles encampment, and threatened to withhold funding from counties that don't crack down on unhoused people.
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Targeting Corporate Landlords, Biden to Unveil National Rent Control Plan
"The rent is too damn high—and rent control is a real fix," one group said, praising the proposal.
Jul 15, 2024
As former U.S. President Donald Trump secured the Republican nomination and announced his running mate on Monday, Democratic President Joe Biden prepared to unveil a proposal that would cap annual rent increases at 5% for tenants of major landlords.
After Biden briefly previewed the proposal during a press conference last week, The Washington Postreported on the planned announcement Monday, citing three people familiar with the matter. The Associated Press separately confirmed the plan.
Biden is set to formally introduce the proposal on Tuesday in Nevada, which "has seen among the biggest explosions of housing costs in the country," the Post noted. "Democrats have grown increasingly concerned that Trump could win the state in November."
The president, who is seeking reelection, will propose taking a tax benefit away from landlords who hike rents by more than 5% annually, according to the reporting. The plan would only apply to the existing housing stock of landlords who own more than 50 units and would require congressional approval—so it is not expected to go anywhere unless Biden wins in November and Democrats secure majorities in both chambers of Congress.
As the newspaper detailed:
The Biden administration is also pushing numerous policies to increase housing construction, through incentives to local governments to change their zoning codes and new federal financial incentives for builders.If implemented, they could bring 2 million new units to the market in addition to the 1.6 million already in the pipeline.
"It would make little sense to make this move by itself. But you have to look at it in the context of the moves they propose to make to expand supply," said Jim Parrott, nonresident fellow at the Urban Institute and co-owner of Parrott Ryan Advisors. "The question is: Even if we get all these new units built, what do we do about rising rents in the meantime? Coming up with a relatively targeted bridge to help renters while new supply is coming online makes a fair amount of sense."
While housing industry representatives criticized the reported proposal, Diane Yentel, president and CEO of the National Low Income Housing Coalition, told The Associated Press that having it in effect in recent years could have helped renters.
"The recent unprecedented increases in homelessness in communities across the country are the result of those equally unprecedented—and unjustified—rent hikes of a couple years ago," she said. "Had such protections against rent gouging been in place then, many families could have avoided homelessness and stayed stably housed."
Other rent control advocates and progressive officials also welcomed the plan, with Kendra Brooks—the first Working Families Party member ever elected to Philadelphia City Council—declaring that "this is exactly the kind of leadership that working families need!"
Jacobin's Branko Marcetic said that "this is huge," particularly considering that "housing has rapidly climbed as a cost-of-living concern (and is also under 30s' most important issue)."
Multiple campaigners and organizations credited housing advocates for pushing rent control at the national level.
"It's amazing how rapidly the conversation around rent caps has changed," noted Shamus Roller, executive director of the National Housing Law Project. "Tenant organizing has created this change. It's a proposal for Congress which will face serious headwinds but the president just called for rent caps (even if only temporarily)."
The Debt Collective said, "We will say it over and over again: The rent is too damn high—and rent control is a real fix."
"Rent caps wouldn't be a national policy proposal without tenants unions across the country making it possible through organizing," the group added. "On our way to land without landlords, remember that rent control works. The 99%'s need for a roof over our head should not be 1% profits."
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