RealPage Settles DOJ Rent Price-Fixing Lawsuit, Agrees to Algorithm Limits
RealPage settled a Justice Department rent price-fixing lawsuit, agreeing to new limits on its rent-pricing software and data usage, without admitting wrongdoing or paying damages.
Overview
- RealPage settled a yearlong antitrust lawsuit with the Justice Department concerning allegations of rent price-fixing and facilitating a housing cartel through its software.
- The settlement requires RealPage to stop using real-time competitor data for rent price recommendations and coordinating pricing with other property management companies.
- Landlords using RealPage's software will face new restrictions on how they track and raise rents, limiting the use of confidential market data for price adjustments.
- The agreement imposes significant new limits on RealPage's rent-pricing algorithm, aiming to prevent anti-competitive practices in the rental housing market.
- RealPage settled without admitting wrongdoing or paying damages, though other property management companies also faced settlements regarding their use of the software.
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Analysis
Center-leaning sources cover this story neutrally by presenting a balanced account of the RealPage settlement. They include direct statements from both the Department of Justice and RealPage's attorney, allowing readers to understand both perspectives without editorial bias. The reporting focuses on factual details of the agreement and related legal actions, attributing strong claims to specific sources.
Articles (3)
FAQ
The Justice Department alleged that RealPage's rent-pricing algorithm enabled landlords to share confidential, competitively sensitive information, coordinate rent prices, and engage in practices that inflated rents and reduced competition in the rental housing market.
RealPage agreed to stop using real-time competitor data for rent price recommendations and coordinating pricing with other property management companies. The settlement also imposed significant limits on how RealPage's rent-pricing algorithm and landlords using it can track and raise rents to prevent anti-competitive practices. RealPage settled without admitting wrongdoing or paying damages.
RealPage's software collected sensitive market data from competing landlords and used algorithms to recommend higher rent prices. This coordination minimized competition among landlords, enabling them to set rent prices artificially higher than they would be in a competitive market, leading to rent increases estimated between 5% and 7% in some areas.
Landlords were encouraged to automatically accept RealPage’s pricing recommendations and explain any rejections, which could lead to escalating review by RealPage. The software advised maintaining high prices even with lower occupancy, and coordinated lease term adjustments to avoid flooding the market, thereby sustaining elevated rent prices and discouraging competitive discounts or negotiations.
The conspiracy allegedly led to artificially inflated rental prices, causing millions of renters, especially in places like Phoenix, Tucson, and New Jersey, to pay significantly higher rents, contributing to housing affordability crises and harming tenants financially during periods of high inflation.
History
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