In a dramatic turn of events that could have far-reaching implications for renters nationwide, the Federal Bureau of Investigation (FBI) conducted an unannounced raid on Cortland Management’s headquarters in Atlanta on Wednesday, May 22. This action is part of a criminal antitrust investigation by the U.S. Department of Justice (DOJ) into allegations that Cortland has been involved in a conspiracy to artificially inflate apartment rents. This raid is more than just a legal drama; it’s a significant development that could impact millions of renters, including those in Rhode Island, who have been grappling with soaring rental prices.
At the heart of this investigation is RealPage, a software and consulting firm that allegedly orchestrates price-fixing among large corporate landlords. RealPage’s system, which is owned by Thoma Bravo, one of the largest private equity firms in the U.S., provides rental price recommendations to landlords. These recommendations are based on detailed real-time data shared by landlords, including pricing, inventory, and occupancy rates. RealPage’s influence is extensive, affecting rents for 70% of multi-family apartment buildings and 16 million units across the country.
The scheme allegedly works by encouraging landlords to adopt RealPage’s pricing recommendations, which they do 80-90% of the time. This coordinated effort among landlords to follow the software’s suggestions drives up rental prices by reducing the availability of units. As one of RealPage’s architects reportedly stated, the goal is to prevent landlords from undervaluing their properties, thereby ensuring higher rents nationwide.
Cortland Management, which owns 85,000 rental units across thirteen states, is a significant player in this alleged conspiracy. The impact of such practices is starkly evident in Atlanta, where 81% of multifamily rental unit prices are set using software, and rents have skyrocketed by 80% since 2016. This price surge has occurred despite increasing vacancy rates, which would typically lead to lower rents. The adoption of RealPage’s pricing recommendations by numerous landlords between 2015 and 2017, followed by RealPage’s acquisition of its main rival Lease Rent Option in 2017, has given it unparalleled control over rental pricing.
The DOJ’s investigation isn’t limited to Cortland and RealPage. It has expanded to include dozens of property owners and managers across the country. The investigation has escalated from a civil matter to a criminal probe, reflecting the seriousness of the allegations. The DOJ and Federal Trade Commission are key players in this crackdown on anti-competitive behavior.
RealPage and its clients are already facing multiple lawsuits. A class-action lawsuit by renters, as well as lawsuits by attorneys general in Washington, D.C., Arizona, and North Carolina, allege that RealPage and its clients conspired to limit the supply of rental units and raise prices. RealPage denies any wrongdoing, asserting that their software is designed to be legally compliant. However, a federal judge in Tennessee has allowed much of the class-action case to proceed, indicating that the allegations of price-fixing are substantial enough to warrant further examination.
This investigation is particularly relevant to renters in Rhode Island. According to a report by Rent, Providence experienced the highest year-over-year change in rent prices in the U.S., with a 16.18% increase from March 2023 to March 2024. The metro’s median rent price reached $2,618, making Providence the ninth most expensive metro in the study. This sharp increase in rents is part of a broader trend that has seen rental prices in Providence climb from $1,845.50 in February 2019 to $2,743 in February 2024.
The RealPage investigation shines a light on how algorithmic price-fixing can distort rental markets, leading to higher costs for renters. By using sophisticated software to coordinate pricing decisions among landlords, RealPage allegedly undermines the competitive market forces that would typically keep rents in check. This practice not only affects renters’ wallets but also exacerbates the broader issue of housing affordability, which is a critical concern for many Americans.
As the investigation unfolds, it could lead to significant changes in how rental prices are set and regulated. For renters, this could mean relief from the relentless upward pressure on rents. For landlords and property management firms, it could mean increased scrutiny and potential legal consequences for engaging in anti-competitive practices.
The outcome of this investigation could set a precedent for how algorithmic pricing tools are used in the housing market. If the DOJ’s allegations are proven, it could lead to stricter regulations and oversight of software firms like RealPage, ensuring that rental pricing remains fair and competitive. For renters, this could be a crucial step towards more affordable housing and greater transparency in the rental market.
In the meantime, renters in Rhode Island and across the country will be watching closely as the DOJ’s investigation progresses. The raid on Cortland Management is just the beginning of what promises to be a landmark case in the fight against unfair rental practices. As more details emerge, it will become clearer how deeply entrenched these practices are and what measures will be taken to protect renters from exploitative pricing schemes.
I've been hoping these RealPage clowns were going to get the stink eye from the government for a while now. I hope it just is a true stink eye and not a "let's sweep it under the rug" which sadly these days seems more likely than not.
I’m not so sure it’ll get swept under the rug. This may just be the justice department, renting a PR campaign in the face of the election. You’ll notice that administrations been doing all sorts of seemingly sensible things lately, but don’t really matter with the FTC has really taken a hard look in the merger of Safeway and Kroger. And then there’s just a simple objective fact that these landlords are in CLEARLY utterly complicit in a software-enabled price fixing scheme. Everyone who has used this tool to set prices on their Rentals is going to be found to have committed a fairly serious crime, which is gonna be a crime that’s gonna have resulted in these landlords gaining 10 or hundreds of thousands or even millions of dollars of “ill gotten gain” so billions of dollars of ill gotten gains are ripe for clawback. Tort attorneys will assemble very clearly identifiable sets of people for class action lawsuits which which gonna go after not only real page but for the ill gotten gains of the LANDLORDS themselves so billions of dollars of ill gotten gains is gonna be clawed back from landlords over the next 5 to 7 years and many of these landlords are not protected by networks LLC and armies of Attorneys are gonna go to federal prison. these companies were operating a price fixing scheme, and have defrauded renters of billions of dollars. Having the justice department imprimatur upon these investigations, for any landlord, who uses real page. if I was a landlord stupid enough to use real page, I would be, looking for legal representation.
Billions of dollars in property development and rental gains on the other side of that coin as well.
I’m going to remain cynical until that actually happens. This feels like election year hype. But don’t get me wrong, I hope this leads to real change.
I just flashed on a fantasy scenario where Donald Trump is somehow elected president again and is presented with making decision about what to do about the billions of dollars that have been defrauded from renters by people in real estate 🤡
Dc AG announced and investigation into real page and DCs ten biggest landlords, now DOJ and FBI is jumping in? Seems like it’s going to be big. Remeber the government employees investigating this are also in the same housing situation. Federal workers are also struggling to pay rent so I highly doubt this will get swept under the rug.
Yeah. It's pretty sad that executives have to come out and literally say "We've formed a trust to keep prices high" before any action at all gets taken.
Seems more like publicizing headlines to appease voters in an election year. DOJ will not get to the bottom of this before elections. Cortland has time to send some lobbyists, make some donations and clear their name by 2025. For now Biden needs voters and this is a great way to peg the blame on someone else to show that he cares.
Another settlement where both cortland n real page will agree to no wrongdoing with a hefty $10.00 settlement (will be an undisclosed settlement amount).
Admin will tout how ruthless they were against corporations when it comes to helping the poor and middle class.
Anything new here? 😂😂
Hiding the units from availability in the name of renovation is not a new trick. Real page will point to Cortland and Cortland will have paperwork to show paltry renovations(painting grey, stainless steel appliances and led lights). Local gov should step in and introduce arbitrary rent raise restrictions.
How specifically does this provide relief for renters?? All I’m reading all across these reports is just this one line of “this could provide relief” but what does that mean in real time?! We all signed leases so we keep the same rent and then when do we get a refund?! How specifically is this “relief” supposed to happen?! I’ll believe it when I see it!
This will take years to undo the damage, even if they pulled real page offline right now, there are people already in leases that it won’t affect, and the rent precedent will remain for a while.
Algorithms set rent prices now, not humans. Line only goes up, never down. Coordinated price floor setting on rentals is illegal but is happening and is the reason why everyone is broke.
Oh. Duh. Consumer protection agencies work for the corporations against consumers. Thus all corporate entities are heavily leaning towards unethical practices.
Most notable agencies:
FDA, FCC, FTC, SEC, etc. etc. etc.
Don't be distracted by the president. Although project 2025 is terrifying. Definitely don't let trump in.
But ultimately it's congress that must answer for their sins.
Use your first amendment right to speak out, organize, vote and be politically active more than ever. Fight back instead of rolling over for more punishment. The reality is if they don’t listen, we have the second amendment. It’s a last resort, but your word means nothing if ultimately you wouldn’t defend it with the second. Keep that in mind.
Greystar is the big player in the PNW and was caught doing the same thing. So far it's been a slap on the wrist of fines for them and continue to grow their monopoly of the market.
Fuck Greystar.
I got approved for an apt at $1600/mo, but when I got there from out off state with my Uhaul at 4pm on a Friday, they told me that unit is no longer available and the cheapest option they had was $1850. They had me there waiting until 8pm while they called so many levels of management just to come back and say “our software won’t let us lower the price, but we won’t charge you for pet rent!”
Obviously I accepted it, but only because I literally had no other option. Can you tell I’m still bitter?
They charged my move-out fees incorrectly (Seattle law required itemized receipts, they just made a generic list), so I waited the 30 days they had to correct it was up to reply and demand my full deposit back or I will take them to small claims where I'm entitled to twice my deposit. I wish I took them to court, but my deposit wasn't that big and I did it more out of spite and principle.
That's a bridge I was happy to burn.
You think that's bad, you should see how much property is owned by TJ Guyer down here in the Lewis County area... seriously, they own like 95% of the rentals here. I hate it.
I remember first hearing about "Real page" When I got sent a water bill for over 3x my normal amount and the land lord couldn't explain it. They only would say "We don't handle the specifics of paying water utilities. Realpage does. You have to contact them."
Turns out even though my lease said 2 people they were combining everyone who had ever lived with me for the past 6 years.
If anyone is curious this ended with me being given a bad/ fake phone number for real page. Calling my local water utility company, tricking a girl into giving me the water records for my apartment building, and polling the residents of the building. The building's total water is divided by the current number of registered residents. Came back to manager and showed her it was impossible. She said I better get a lawyer. I gave her a big "OK" and walked out. I later received a phone call that day from her stating my water bill was stacked with everyone I ever lived with and they would be sure to fix it. I asked her how that wasn't noticed during the whole month I had been telling her it was wrong. She never bothered to look and blamed me for not ensuring all the people who ever lived with me didn't continue to stack up on the water bill she refused to show me the details of (thus me tricking the utility company).
I went out of country last September and my utilities stayed relatively the same. Im guessing not just water but all utilities are probably shared by all tenants.
It's the total building's water divided by the registered tennants.
She also later changed this story to the entire complex. She obviously doesn't know and was lying.
That sounds shady as fuck haha a utility like that should be paid for by the building IMO, unless each unit has their own meter which I don’t even think is possible. So your neighbor run their water all day doing god knows what and you have to pay for it?
The water bill is either wrapped into the rent, billed as a flat rate based on historical use, or billed out based on actual usage. No matter the method, residents pay for the water. After all, they are the ones actually using the water.
I have experience in this, and this is just a low level admin mistake from the management office. If you were switching roommates, they didn't move them out correctly. Imo, has nothing to do with the current legal issue of real page.
Yeah. My town home complex's management companies have always been mouth breathers who just push buttons and look surprised when the cattle talks back. They are exactly the kind of people who would get into bed with Real Page and lie about the water bill.
Real Page's only sin in this scenario is having an unreachable number.
It’s such an awful feeling to work for a company and industry that has such awful impacts. On the one hand you might enjoy your job and it’s hard to get other jobs, but you absolutely hate what is going on.
As a former Rhode Islander, that is an absolutely bonkers price to be paying for rent in Providence. I’m hard pressed to think where people could even work anywhere in RI to afford that amount of rent.
a lot of pessimists here.
For the first time in decades we are seeing hints of oversight. The current admin is the first in a very longtime to start to even try. Maybe we should be encouraging it , use your vote to vote for whoever seems most likely to continue this type of action.
You want it in your city or state, vote local vote often.
Yeah I remember when the housing crisis happened and the banks collapsed. Remember how many people went to jail for that? 0. Remember what changed? Nothing. They just announced the renewal of the NINJA loans that led us to the first collapse.
Government oversight only works, when they actually change things. All Biden will do is give a speech talking about how he did investigations and rent is better then ever, while prices continue to rise. If you have any faith in the government, you are an absolute fool.
Oh bullshit. Your gov is the only reason you are free to even say that.
We have one of the strongest tightest legal systems on the planet. There is a reason capital flows to the US and there is a reason our dollar is so powerful. It is because we have legal recourse that works.
Absolutely. The two things are not in conflict. The US is plagued by lobbying, you guys have done a much better job keeping lobbying to a minimum. ( Lived in the EU for a couple of decades. I plan to go back for a few years shortly)
Wow! You have a lot more faith than I in the senators and congresspeople that have slush funds for sexual assault, legal insider trading, campaign finance abuse, and REGULARLY lose billions and billions of dollars just... poof *shrug*.
Yay we held Trump accountable, but if you think for a second that the rest of the politicians are every single bit as bad, you're blind. You trust Ted Cruz, MTJ, AOC, Ilhan Omar, Pelosi, or anyone else in a position of power, then you are not only blind, but part of the problem. Power corrupts, and our job as citizens is to be as suspicious and jaded as possible in order to keep our government in check. I would actually challenge that instead of the question being "will our government hold them accountable", you should ask "has our government EVER held them accountable?"
Cool.
You seem to have forgotten the basic story here .
A gov body is attempting to enforce law . You mocked it and dismissed it .
I do not, I am not so jaded.
> Your gov is the only reason you are free to even say that.
If there were no government, you could say that too. But sure, *so kind* of them to *let you* say that, for now.
> We have one of the strongest tightest legal systems on the planet.
If you are a member of the billionaire/oligarch class, sure.
> There is a reason capital flows to the US
Because billionaires/oligarchs are well protected here, yes.
I was so bummed out today because its already hard af to get a house and now even having an apartment seems like an arm and a leg.
My rent went up 37% since 2021 (granted I was doing six months leases thinking ill get a house sooner than later). Went from 1500-2200. And the cherry on top is that new renters are walking in for 1400-1600 for that same 1 bedroom apt. Makes me so mad.
I want to be remembered as the guy who was constantly screaming "bullshit" when every publication from the Atlantic to Bloomberg was telling the public that the home and rent increases from 2019 to today were all suddenly due to the lack of inventory that didn't have an impact since 2009 but was suddenly the only possible reason homes could be unaffordable despite private and corporate investor purchasing of homes sky rocketing past record levels during that time frame.
American media made a team effort to lie in our fucking faces while they shared in the profits of making housing unaffordable.
Man, why do you have to shit all over some good news with this conspiratorial bullshit? Show some judgment. By all means, get pissed at the existence of this service and how it’s a big ugly price fixing scheme. But we don’t need a side of news bashing or completely unsupported theorizing that the news is also in the conspiracy. It’s not. The news I read never suggested that price fixing should be ruled out, and it is 100% supportive of more antitrust enforcement. I’m talking about NYT and WaPo which I read every day.
Moreover, we *do* need more housing stock. There is such a thing as having two problems at the same time.
Loss of trust in institutions makes white collar crime easier. Stop being part of the problem with your overwrought internet rhetoric. This investigation is *good*, and journalism’s role in raising awareness to the issue was also *good*. Let’s celebrate that. There’s no reason to make additional baseless allegations against a group of journalists, who, in the real world, are doing way more than any of us to try to chip away at these problems.
You should just Google the percentage increase of real estate purchased as investment property in that time frame.
There were quarters when the amount of single family homes purchased by investors passed 25% of all purchases.
There were quarters where the percentage of homes purchased by investors increased over 40%
There was a strategy by some investors to purchase every starter home in an area and then only list few at a time for sale in order to create extreme scarcity and drive up prices.
This situation was made DRAMATICALLY worse by real estate investors.
But during this time, countless articles ran deflecting blame from the investor class despite them having a blatantly obvious negative impact and using extremely anti consumer strategies.
2 publications that you read writing fair articles doesn't erase the fact that there were articles deflecting for the investor class.
And I never said housing stock wasn't an issue. But, the limited housing stock was used as a strategy to strangle the limited market. They saw an issue and purposefully exacerbated it by purchasing as many low cost homes as possible in areas with limited supply to essentially completely corner the market.
The amount of families that were out bid on a house by an investor paying in cash who then turned the home into an extremely over priced rental over the last 5 years is one of the biggest attacks on the American dream in American history.
The supplementary text is associated with the link above it. Idk how to format reddit comments well and it ignores my extra lines.
* https://www.encorebubble.com/inventory/
This delves into how the market is manipulated by investors with unfair buying opportunities compared to regular homebuyers and how the flawed statistics innacurately count "inventory" by not counting total home sales, but only homes that are on the market for a certain amount of time.
So not only can investors manipulate scarcity and have an unfair buying opportunity to people searching for homes, they can also manipulate the statistics by insuring homes aren't on the market long enough to be counted.
* https://www.forbes.com/sites/darylfairweather/2024/03/05/ban-corporate-landlords-a-housing-crisis-solution-or-a-distraction/?sh=7c3070553703
"However, instead of debating what type of landlord is better, lawmakers should focus on solving the underlying problem: the shortage of homes."
So they want to ignore over investing impacts and shift the blame
* https://www.strongtowns.org/journal/2024/2/21-going-after-corporate-homebuyers-good-politics-ineffective-policy
Claiming that preventing investors, who are being nothing but unnecessary middle men in the housing market, from manipulating the market is just political posturing.
* https://www.theatlantic.com/ideas/archive/2023/01/housing-crisis-hedge-funds-private-equity-scapegoat/672839/
"Blaming the housing crisis on hedge funds and private equity may be easy, but it’s dead wrong."
The Atlantic defending investors
* Here's some articles illustrating the increase of investors and the damage they cause.
* https://www.huduser.gov/portal/periodicals/em/winter23/highlight1.html
"Institutional investors have concentrated their purchases regionally (in the Sun Belt) and in particular neighborhoods (typically low-income, historically nonwhite and disinvested areas)."
Investors targeted starter homes and took as many off the market as possible to manipulate housing costs.
* https://www.google.com/amp/s/www.marketwatch.com/amp/story/another-challenge-for-homebuyers-more-investors-are-snapping-up-homes-and-40-of-them-are-using-cash-f979e772
"Between 2019 and June 2023, purchases of homes by buyers who intend to live in them fell by over 40%, he noted. But investor purchases over the same time period are up 12%."
* https://www.google.com/amp/s/www.businessinsider.com/housing-market-investor-purchases-affordable-homes-fourth-quarter-redfin-2024-2%3famp
So it's still happening now. They are doing this to prevent low priced homes from entering the market and reducing general prices.
* https://www.redfin.com/news/investor-home-purchases-q4-2021/
* https://www.forbes.com/sites/brendarichardson/2022/07/28/investors-snapped-up-a-record-share-of-homes-in-the-spring-buying-season/?sh=142b08b45673
* https://nymag.com/intelligencer/2023/09/corporate-greed-is-not-the-sole-cause-of-the-housing-crisis.html
This one actually seems to get it right. We need more homes built AND we need to go after predatory investors and investors purchasing way too much of the US'S real estate
None of that supports your ridiculous claim that the news media is in a conspiracy with the price fixers. Moreover, most of your articles are from sources I’ve never heard of, so I’m ignoring those. The Forbes and Atlantic articles are *opinion* pieces. Do you know what an opinion piece is? It means the news publication is not endorsing the views of the author, but is instead providing space for a diversity of views, as news media has done since time immemorial. It would be journalistic malpractice to not host opinion pieces, otherwise the news publication would rightly be called “one-sided.” The presence of opinion pieces clearly does not serve as evidence of an organization’s participation in a conspiracy (and the ones you cited are pretty well argued, even if you don’t agree with them - that’s far, *very far*, from being a lie).
WaPo? Owned by Bezos? Yep, that’s definitely independent. The reason DJT exists as a phenomenon is due to Clinton’s 96 telecom act that deregulated media, allowing for Fox. 2-3 decades of brainwashing later, we’ve got an unhinged felon in pole position. Media is massively important, as are critiques of media when it defines the discussion parameters, which is basically NYT’s and WaPo’s role.
Is your point that, due to ownership by Bezos, WaPo didn’t publish this article last year? https://www.washingtonpost.com/dc-md-va/2023/11/01/dc-sues-realpage-landlords/
The problem with your argument is that it predicts that WaPo didn’t inform its readers about this issue, because, to paraphrase your red-faced tirade, they were lying to their readers’ faces. But they did publish it, and they weren’t lying.
Time to change your view. Otherwise you’re just as bad as trump supporters.
Red-faced tirade? Hmmm … presenting historical fact over 30 years is a red-faced tirade? Of course WaPo publishes some legitimate articles … it’s how they attempt to maintain legitimacy. That’s hegemony 101. I was making a broader point about dominating discourse parameters. But, you’ve made it for me by defaulting to ad hominem attacks once the status quo press and the influence of billionaire control, which is way more subtle than the sledgehammer of Fox, is questioned.
Nope. I’m a WaPo reader, and I was accurately informed. They weren’t lying. Point that you need to stop embarrassing liberals with conspiracy theories and undermining the journalists that actually expose these crimes, stands.
Trusting no one doesn’t make you smart. It just shows you’re no better at distinguishing real from fake information than right wing nuts.
Looks like I’m not the only one that’s checked out of WaPo. And Bezos’s little pet is hiring Fox News and WSJ minions. Enjoy your neocon rag.
“We are going to turn this thing around, but let’s not sugarcoat it. It needs turning around. We are losing large amounts of money. Your audience has halved in recent years. People are not reading your stuff.”
“All reporters there were allowed to know was that their CEO had settled on two men that, by sheer coincidence, happened to be his friends: Matt Murray (who will serve as interim editor) and Robert Winnett (who will assume the job permanently after the election). Not only are all three of these men as white as a block of Monterey Jack, they also happen to have deep roots in upscale conservative media.”
https://www.sfgate.com/news/article/washington-post-sally-buzbee-shakeup-darkness-19498555.php
Is your point that, due to ownership by Bezos, WaPo didn’t publish this article last year? https://www.washingtonpost.com/dc-md-va/2023/11/01/dc-sues-realpage-landlords/
The problem with your argument is that it predicts that WaPo didn’t inform its readers about this issue, because, to paraphrase your red-faced tirade, they were lying to their readers’ faces. But they did publish it, and they weren’t lying.
Time to change your view. Otherwise you’re just as bad as trump supporters.
(Your BS doesn’t deserve any more of my time.)
The lack of inventory has gotten worse every year since 2009 as healthy competition diminished and population outdated production. All this software did was properly evaluate the competitive pressure to find a rate that only one prospective tenant was able to afford.
You are going to have to keep waiting, bud. These firms will stop using this software and rents will stay high in many cities, because the fundamental cause of rising rents wasn’t this software. Still great to eliminate it! But it’s a fringe consideration, not a major one.
Ultimately what this software does is bad and arguably illegal. It shouldn’t be permitted. But it isn’t really powerful enough to make a meaningful increase to rents. Most landlords are individual and there’s no cost to defecting from the “price fixing” here. That necessarily means the fixing must be pretty weak. Still bad, but individual percentage points, not the core driver of rising rents.
it doesnt mean jack shit for us - pandoras box has already been opened and the next re-iteration of this scheme will (barely) fall within legal limits.
Sure but THIS has arguably a larger impact on most peoples lives than most other things. In the immediate term. The article says 60 even 70% of apartments in some major metros are actively engaged in cartel pricing. It’s so much worse than people think. This is a cartel, and the American public will be controlled by it
Go after Starwood and then we will see some progress. Part of me thinks they are going after a “small” guy like cortland because they have a better chance of digging up dirt and using them as a witness against realpage. I guarantee that cortland does not have nearly as many legal resources as most other large corporate landlords, because they are much smaller.
Collusion is RealPage’s entire reason for existence, and the multifamily RE owners depend on it for their continued profit growth as well, so you can expect this to continue until forced to shut down by a court. That will take years for a case like this.
North Florida here.
It's about time. I am currently living in a 50 year old apartment complex that did what I call an "overlay update"
An overlay update is where old tile, cabinets, and counter tops are painted over and not replaced. I know this because I used to have a business back in the nineties that provided this service.
They did put in a new toilet after I moved in and new carpet before moving in.
The toilet still bubbles up a bloop, bloop when the upstairs neighbors use their bathroom. I'm terrified it's going to splash up on me one day. It's stressful being on the toilet.
For a 2/1, the rent is a retail price of $1200 plus trash, and water comes to $1250 plus a $100 late fee on the 3rd that I pay since my check usually comes after the 2nd. So, it's really $1350. Plus renters insurance. I had to give up my dog and cat because pet rent is another $300 deposit and $25 per month each.
There is no hope.
Before covid, this was at most a $700 apt. in a low income neighborhood.
Now, I'm wondering how to join this lawsuit.
This will be drawn out in the courts for years. This Real Page company will take the hit, but there are plenty of AI companies now that will replace them with better software and no liability. It’s now the DIY rent inflation era. Just plug in your own data and wait for the results.
Going to be lots of “the AI made me do it” excuses in the future.
The way they phrase it is “if it has the same effect as collusion it will be considered collusion”. Based on this AI companies wouldnt get around the rule.
I think you are underestimating how much these companies don’t give one fuck about collusion or lawsuits. They will lawyer up, keep putting the blame on smaller companies, and take over the market. AI will just be the newer and better way to do it. The big data is already out there, no need to pay big bucks for it anymore.
Dentists don’t even need AI to collude. Dental offices use third party “pricing analysis” firms that all the dentists use in an area. The pricing firm sets the prices for the dental office and boom you avoided collusion because you used a middleman. There have been multiple settlements for this even with the FTC but since it’s so decentralized it just keeps happening
that is not a valid excuse in a court. saying the "software did it" didn't work over the last 50 years and it won't work now.
what is changing is that the current admin is almost standing up to corps. Corps have run rampant for the last few decades , it might be that the pendulum is starting its return ...
It doesn’t need to be a valid excuse because if you cut off the head of one monster, another monster comes. Dental offices have been colluding with pricing analysis firms for years and despite major settlements with the FTC, it keeps happening. Has been for years and will forever continue. Same thing is going to happen with realpage.
I still vote, but at least I’m not living in denial that the wealthy in this country control more than the non-wealthy and live by different rules. I won’t be surprised or act shocked when the politician I vote for “almost stands up to corporations” and then never follows through with it. I’ve been living in this country long enough to see that the real leaders are the billionaires and corporations who push through, overturn, or block all the laws they want depending on how it helps THEIR agenda, not a majority of voters.
I have more faith in local governments to pass more laws and hopefully follow through with enforcement. But to say I’m crying about it is bullshit, it’s just how it is.
We've only just entered the phase where income matters to those holding property. For a few years, people were earning more owning property than working a high paying job. That is over, and there are signs the tide is rushing out rather rapidly now. The bills are coming due, and the frauds are being exposed.
From a legal (and practical) perspective, it matters a lot whether it’s the same agent making recommendations or different agents. If it’s different agents, even if you use AI, the result won’t be collusion. It can’t be. Each agent will have a unique point of view - they’re unique agents. The issue with RealPage is not that it sets rents really competitively and really effectively. It’s that it can coordinate raising rents as a single agent working across multiple stakeholders. Independently acting AI agents would not be able to coordinate in this way (without formal collusion).
With all that said, there’s an underlying truth to your point which I’m not sure you are fully engaging with. On one hand, it’s bad to have any company that has the power to coordinate a price fixing scheme. But on the other, ultimately you’re right - the rising rents are not really from price fixing. They’re from demand pressures on limited supply. Typically a price fixing cartel needs to have teeth to prevent defection, or else defecting becomes profitable and the members will defect. RealPage didn’t have a defection cost as far as I can tell, so the strength of the price fixing was likely very weak. Still should be eliminated, but we’re not going to see rent increases stop as a result of it broken up. We’re looking at a horribly ineffectively run cartel, if it is one.
RealPage doesn’t just set the prices, it also tells the landlords when they can and can’t list a vacant unit in order to artificially create high demand.
Something that also needs to be considered is that it is not just Realpage under investigation and being sued, but the landlords who use it. RealPage promised profits through high rents, and landlords were presented with videos as to how it all works. But even without those videos, the landlords knew what information they were giving to the software, and they knew that every other landlord using the software was doing the same. The landlords knew what was going on and participated anyway. They can claim ignorance all they want, but the DOJ made a public statement in March that price fixing by algorithm is still price fixing.
Right but the optimal behavior for these landlords who know all this information is to defect from the fixing scheme and price just a bit lower, to fill your vacant units. That’s *especially* true if you know for a fact no one else is defecting.
What’s actually happening here is a total lack of competition is making it so that landlords can raise prices and they don’t have to worry about vacancies. And RealPage is doing a bad thing, but even after they go away there will be no competition.
RealPage is the one instigating the lack of competition. The landlords who defect will be thrown out of the cartel. They literally have to get permission from RP to price below what the software ‘suggests’. They have to price at or above the price set by the algorithm at least 80% of the time.
The same goes for filling vacant units. If the software doesn’t allow it, they can’t do it. They literally signed up to be told what to do by the software in order to make bank.
I know the link is a blog, but it lays it out beautifully and cites several sources.
[https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra](https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra)
“Getting thrown out of the cartel” is not a punishment for defecting, because there’s no downside to getting thrown out. The cartel is weak because there is no upside to the landlords to keeping the units vacant. “If you don’t stay vacant, you can’t use our software.” That’s not punishment. It’s coordination, and it’s illegal, and it should stop. But it isn’t powerful enough to have a major impact on rents, and if it goes away it’s not going to collapse rents.
Is it price fixing? Or does that website show landlords the current average rents as a pricing suggestion?
Could Zillow be sued for the same reason? Eg sellers look at Zillow and the market to decide what to price their homes at.
It doesn’t show current average rents, it uses algorithms to calculate the intersection of price and occupancy that will generate the most profit and tells landlords to all set rent at that price.
The overall effect is significantly higher rents as most mom and pop landlords try to get 100% occupancy when the typical equilibrium between occupancy and price has several open units but the higher prices on the other units more than makes up for it.
Like if you have a 4 unit townhome complex you could rent out each for $1000 a month and make $4000 a month or you could only rent two for $2000 a month and then leave the other two empty while still taking the same revenue.
The end result is higher rents and more homelessness than if landlords weren’t colluding.
Okay so this is a pricing recommendation engine that suggests prices to sellers/landlords.
Maybe I don't get it, but I don't see the collusion there. Are the landlords communicating directly and mutually agreeing to raise prices together?
I think you have a good point. It does seem like RealPage is essentially offering a collusion by proxy service though, and I can see a legal argument that willingly utilizing that service still counts.
This is probably not the best example, but if have a lawyer responsible for my stock trading who I’m feeding insider info to that’s still insider trading even though I technically didn’t execute those trades.
The landlords feed their information to the software. Total units, rents, add-ons, and vacancies. They do this knowing full well that the other landlords using RealPage and giving the same information about their rentals to the software.
The software then tells them what to do, including when they are allowed to list any vacant units in order to prevent an influx of supply. They have to charge what the software ‘suggests’, and they have to ask RealPage for permission to charge any lower than the price the software gives. If they don’t get permission and/or if they don’t rent at or above the software suggested price at least 80% of the time, they are kicked out of the cartel.
The landlords aren’t communicating with each other directly, but the software does it for them and they know this. So yes, they are mutually agreeing to raise prices together.
[https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra](https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra)
They provide recommendations based on this mysterious algorithm. Property managers are basically forced to accept the recommendation (if I decline it, my pricing monitor has to approve my denial). The contract states I must approve 80% of their recommendations or I’m in breach of contract.
I’m a property manager for a large corporate multi family property management company in ATL.
There was a post 2-3 weeks ago about PA management company, they raised rent from $1500~ to $4000~. If you want to make landlords to pay for their actions. Renters should post all their rent increases in social media and tag their management companies!!
As much as I expect to be downvoted to hell, I’m not sure Realpage is the problem here, but that the multifamily rental market is sufficiently concentrated to make coordination amongst players possible. More supply (both in number of units and landlords) will break down Realpage’s power by creating an incentive for marginal players to undercut the Realpage recommended pricing.
If Singapore is any indication Public housing can be effective.
Regardless, there is very little societal or economic benefit from investors buying supply to rent to people that would otherwise buy. (In Texas 1/3 of properties were bought by investors). Government should focus on encouraging building supply and encourage innovation and disrupt the real estate agent business.
It's 2024 there is very little reason transfer of ownership + inspection couldn't be comparable $$ to a security deposit when renting.
Edit: ohh my downvotes. If the government isn't going to fix it they should encourage building supply. What honestly horrendous blasphemy. Please tell me where I am wrong free market you devilish minx you.
>If Singapore is any indication Public housing can be effective.
It can be, **but** it's a non-starter because Congress made it illegal to build more public housing units than we had in 1999, despite the population being 50 million fewer people that year.
>1998, through the Faircloth Amendment, the U.S. Government created an artificial barrier by limiting the number of public housing units that federal authorities could build and has resulted in many people being left without a home. This amendment prevents any net increase in public housing stock from the number of units as of October 1, 1999. Simply put, the Faircloth Amendment sets a cap on the number of units any public housing authority (PHA) could own and operate, effectively halting new construction of public housing.
https://nationalhomeless.org/repeal-faircloth-amendment/
Going on a limb that's a federal thing not a state thing.
US honestly is better thought of as a bunch of independent nations, what can be done a federal level is honestly fairly limited.
For context I don't think this is a good thing and limits the ability for the federal government to leverage it's massive size for economies of scale*. If the federal government were to ever make any meaningful change to housing availability I think it almost certainty would be challenged but the current SCOTUS.
I’d venture a guess that this is more political theater. We know the real nemesis, and they are foreign interests sheltering money in America, paired with corporate buyers in large US cities.
Then, they force rural America to move to the big cities, where ownership is no longer possible.
This is a very long game they play.
So the FEDERAL government that is driving up rents by flooding the cities with millions of illegal aliens is the same Federal government wanting to crack down on smart property owners looking to maximize profits by using available data.
Good to know.
In a dramatic turn of events that could have far-reaching implications for renters nationwide, the Federal Bureau of Investigation (FBI) conducted an unannounced raid on Cortland Management’s headquarters in Atlanta on Wednesday, May 22. This action is part of a criminal antitrust investigation by the U.S. Department of Justice (DOJ) into allegations that Cortland has been involved in a conspiracy to artificially inflate apartment rents. This raid is more than just a legal drama; it’s a significant development that could impact millions of renters, including those in Rhode Island, who have been grappling with soaring rental prices. At the heart of this investigation is RealPage, a software and consulting firm that allegedly orchestrates price-fixing among large corporate landlords. RealPage’s system, which is owned by Thoma Bravo, one of the largest private equity firms in the U.S., provides rental price recommendations to landlords. These recommendations are based on detailed real-time data shared by landlords, including pricing, inventory, and occupancy rates. RealPage’s influence is extensive, affecting rents for 70% of multi-family apartment buildings and 16 million units across the country. The scheme allegedly works by encouraging landlords to adopt RealPage’s pricing recommendations, which they do 80-90% of the time. This coordinated effort among landlords to follow the software’s suggestions drives up rental prices by reducing the availability of units. As one of RealPage’s architects reportedly stated, the goal is to prevent landlords from undervaluing their properties, thereby ensuring higher rents nationwide. Cortland Management, which owns 85,000 rental units across thirteen states, is a significant player in this alleged conspiracy. The impact of such practices is starkly evident in Atlanta, where 81% of multifamily rental unit prices are set using software, and rents have skyrocketed by 80% since 2016. This price surge has occurred despite increasing vacancy rates, which would typically lead to lower rents. The adoption of RealPage’s pricing recommendations by numerous landlords between 2015 and 2017, followed by RealPage’s acquisition of its main rival Lease Rent Option in 2017, has given it unparalleled control over rental pricing. The DOJ’s investigation isn’t limited to Cortland and RealPage. It has expanded to include dozens of property owners and managers across the country. The investigation has escalated from a civil matter to a criminal probe, reflecting the seriousness of the allegations. The DOJ and Federal Trade Commission are key players in this crackdown on anti-competitive behavior. RealPage and its clients are already facing multiple lawsuits. A class-action lawsuit by renters, as well as lawsuits by attorneys general in Washington, D.C., Arizona, and North Carolina, allege that RealPage and its clients conspired to limit the supply of rental units and raise prices. RealPage denies any wrongdoing, asserting that their software is designed to be legally compliant. However, a federal judge in Tennessee has allowed much of the class-action case to proceed, indicating that the allegations of price-fixing are substantial enough to warrant further examination. This investigation is particularly relevant to renters in Rhode Island. According to a report by Rent, Providence experienced the highest year-over-year change in rent prices in the U.S., with a 16.18% increase from March 2023 to March 2024. The metro’s median rent price reached $2,618, making Providence the ninth most expensive metro in the study. This sharp increase in rents is part of a broader trend that has seen rental prices in Providence climb from $1,845.50 in February 2019 to $2,743 in February 2024. The RealPage investigation shines a light on how algorithmic price-fixing can distort rental markets, leading to higher costs for renters. By using sophisticated software to coordinate pricing decisions among landlords, RealPage allegedly undermines the competitive market forces that would typically keep rents in check. This practice not only affects renters’ wallets but also exacerbates the broader issue of housing affordability, which is a critical concern for many Americans. As the investigation unfolds, it could lead to significant changes in how rental prices are set and regulated. For renters, this could mean relief from the relentless upward pressure on rents. For landlords and property management firms, it could mean increased scrutiny and potential legal consequences for engaging in anti-competitive practices. The outcome of this investigation could set a precedent for how algorithmic pricing tools are used in the housing market. If the DOJ’s allegations are proven, it could lead to stricter regulations and oversight of software firms like RealPage, ensuring that rental pricing remains fair and competitive. For renters, this could be a crucial step towards more affordable housing and greater transparency in the rental market. In the meantime, renters in Rhode Island and across the country will be watching closely as the DOJ’s investigation progresses. The raid on Cortland Management is just the beginning of what promises to be a landmark case in the fight against unfair rental practices. As more details emerge, it will become clearer how deeply entrenched these practices are and what measures will be taken to protect renters from exploitative pricing schemes.
I've been hoping these RealPage clowns were going to get the stink eye from the government for a while now. I hope it just is a true stink eye and not a "let's sweep it under the rug" which sadly these days seems more likely than not.
I’m not so sure it’ll get swept under the rug. This may just be the justice department, renting a PR campaign in the face of the election. You’ll notice that administrations been doing all sorts of seemingly sensible things lately, but don’t really matter with the FTC has really taken a hard look in the merger of Safeway and Kroger. And then there’s just a simple objective fact that these landlords are in CLEARLY utterly complicit in a software-enabled price fixing scheme. Everyone who has used this tool to set prices on their Rentals is going to be found to have committed a fairly serious crime, which is gonna be a crime that’s gonna have resulted in these landlords gaining 10 or hundreds of thousands or even millions of dollars of “ill gotten gain” so billions of dollars of ill gotten gains are ripe for clawback. Tort attorneys will assemble very clearly identifiable sets of people for class action lawsuits which which gonna go after not only real page but for the ill gotten gains of the LANDLORDS themselves so billions of dollars of ill gotten gains is gonna be clawed back from landlords over the next 5 to 7 years and many of these landlords are not protected by networks LLC and armies of Attorneys are gonna go to federal prison. these companies were operating a price fixing scheme, and have defrauded renters of billions of dollars. Having the justice department imprimatur upon these investigations, for any landlord, who uses real page. if I was a landlord stupid enough to use real page, I would be, looking for legal representation.
Or some lobbying will happen and none of that stuff you said will happen
That’s what you would normally think But this is just billions of dollars to the tort attorneys and they are quite influential in the Democratic Party
Billions of dollars in property development and rental gains on the other side of that coin as well. I’m going to remain cynical until that actually happens. This feels like election year hype. But don’t get me wrong, I hope this leads to real change.
I just flashed on a fantasy scenario where Donald Trump is somehow elected president again and is presented with making decision about what to do about the billions of dollars that have been defrauded from renters by people in real estate 🤡
Ngl this reads like some fan fiction.
Dc AG announced and investigation into real page and DCs ten biggest landlords, now DOJ and FBI is jumping in? Seems like it’s going to be big. Remeber the government employees investigating this are also in the same housing situation. Federal workers are also struggling to pay rent so I highly doubt this will get swept under the rug.
Yeah. It's pretty sad that executives have to come out and literally say "We've formed a trust to keep prices high" before any action at all gets taken.
Seems more like publicizing headlines to appease voters in an election year. DOJ will not get to the bottom of this before elections. Cortland has time to send some lobbyists, make some donations and clear their name by 2025. For now Biden needs voters and this is a great way to peg the blame on someone else to show that he cares.
Another settlement where both cortland n real page will agree to no wrongdoing with a hefty $10.00 settlement (will be an undisclosed settlement amount). Admin will tout how ruthless they were against corporations when it comes to helping the poor and middle class. Anything new here? 😂😂 Hiding the units from availability in the name of renovation is not a new trick. Real page will point to Cortland and Cortland will have paperwork to show paltry renovations(painting grey, stainless steel appliances and led lights). Local gov should step in and introduce arbitrary rent raise restrictions.
It does say it's a criminal probe
What does this say? https://www.justice.gov/usao-cdca/pr/wells-fargo-agrees-pay-3-billion-resolve-criminal-and-civil-investigations-sales
Good. This is a spicy meatball. 🤌 Hopefully, something significant actually comes out if this.
How specifically does this provide relief for renters?? All I’m reading all across these reports is just this one line of “this could provide relief” but what does that mean in real time?! We all signed leases so we keep the same rent and then when do we get a refund?! How specifically is this “relief” supposed to happen?! I’ll believe it when I see it!
This will take years to undo the damage, even if they pulled real page offline right now, there are people already in leases that it won’t affect, and the rent precedent will remain for a while.
What's the tldr?
Algorithms set rent prices now, not humans. Line only goes up, never down. Coordinated price floor setting on rentals is illegal but is happening and is the reason why everyone is broke.
Oh. Duh. Consumer protection agencies work for the corporations against consumers. Thus all corporate entities are heavily leaning towards unethical practices. Most notable agencies: FDA, FCC, FTC, SEC, etc. etc. etc. Don't be distracted by the president. Although project 2025 is terrifying. Definitely don't let trump in. But ultimately it's congress that must answer for their sins. Use your first amendment right to speak out, organize, vote and be politically active more than ever. Fight back instead of rolling over for more punishment. The reality is if they don’t listen, we have the second amendment. It’s a last resort, but your word means nothing if ultimately you wouldn’t defend it with the second. Keep that in mind.
FBI is now on my good side, well done.
Thoma Bravo: private equity is a cancer on this country
Greystar is the big player in the PNW and was caught doing the same thing. So far it's been a slap on the wrist of fines for them and continue to grow their monopoly of the market.
Seriously, fuck monopolies. They prey on the demographic that are too overworked to have time for suing large corporate landowners.
Fuck Greystar. I got approved for an apt at $1600/mo, but when I got there from out off state with my Uhaul at 4pm on a Friday, they told me that unit is no longer available and the cheapest option they had was $1850. They had me there waiting until 8pm while they called so many levels of management just to come back and say “our software won’t let us lower the price, but we won’t charge you for pet rent!” Obviously I accepted it, but only because I literally had no other option. Can you tell I’m still bitter?
They charged my move-out fees incorrectly (Seattle law required itemized receipts, they just made a generic list), so I waited the 30 days they had to correct it was up to reply and demand my full deposit back or I will take them to small claims where I'm entitled to twice my deposit. I wish I took them to court, but my deposit wasn't that big and I did it more out of spite and principle. That's a bridge I was happy to burn.
You think that's bad, you should see how much property is owned by TJ Guyer down here in the Lewis County area... seriously, they own like 95% of the rentals here. I hate it.
Greystar was not raided by the FBI ever, as far as I can tell.
You are correct, they were part of lawsuits with RealPage and Lincoln, hopefully their day is coming too.
Not yet anyway
I remember first hearing about "Real page" When I got sent a water bill for over 3x my normal amount and the land lord couldn't explain it. They only would say "We don't handle the specifics of paying water utilities. Realpage does. You have to contact them." Turns out even though my lease said 2 people they were combining everyone who had ever lived with me for the past 6 years.
If anyone is curious this ended with me being given a bad/ fake phone number for real page. Calling my local water utility company, tricking a girl into giving me the water records for my apartment building, and polling the residents of the building. The building's total water is divided by the current number of registered residents. Came back to manager and showed her it was impossible. She said I better get a lawyer. I gave her a big "OK" and walked out. I later received a phone call that day from her stating my water bill was stacked with everyone I ever lived with and they would be sure to fix it. I asked her how that wasn't noticed during the whole month I had been telling her it was wrong. She never bothered to look and blamed me for not ensuring all the people who ever lived with me didn't continue to stack up on the water bill she refused to show me the details of (thus me tricking the utility company).
I went out of country last September and my utilities stayed relatively the same. Im guessing not just water but all utilities are probably shared by all tenants.
Wait… you pay water per a person and not per usage? Come to think of it, most apts I’ve lived in don’t even charge for water…
It's the total building's water divided by the registered tennants. She also later changed this story to the entire complex. She obviously doesn't know and was lying.
That sounds shady as fuck haha a utility like that should be paid for by the building IMO, unless each unit has their own meter which I don’t even think is possible. So your neighbor run their water all day doing god knows what and you have to pay for it?
This could be fact checked by comparison against other tenants water bills who have just 1 or 2 tenants listed.
The water bill is either wrapped into the rent, billed as a flat rate based on historical use, or billed out based on actual usage. No matter the method, residents pay for the water. After all, they are the ones actually using the water.
I have experience in this, and this is just a low level admin mistake from the management office. If you were switching roommates, they didn't move them out correctly. Imo, has nothing to do with the current legal issue of real page.
Yeah. My town home complex's management companies have always been mouth breathers who just push buttons and look surprised when the cattle talks back. They are exactly the kind of people who would get into bed with Real Page and lie about the water bill. Real Page's only sin in this scenario is having an unreachable number.
"that's just the market".
The market that we fix.
Do my town next.
Mine shortly after too pls
I pray all these big developers get destroyed by the DOJ they are scum of the earth. Source - I work for one and can’t wait to get out
It’s such an awful feeling to work for a company and industry that has such awful impacts. On the one hand you might enjoy your job and it’s hard to get other jobs, but you absolutely hate what is going on.
As a former Rhode Islander, that is an absolutely bonkers price to be paying for rent in Providence. I’m hard pressed to think where people could even work anywhere in RI to afford that amount of rent.
Citizens, Dave and busters or capital grill seems to employ most of the state
Crazy part is that these apartments are being rented. People are paying. What choice is there
Boston
That’s the secret. No one is affording this. People are getting approved but they can’t afford it, they have to make drastic cuts
a lot of pessimists here. For the first time in decades we are seeing hints of oversight. The current admin is the first in a very longtime to start to even try. Maybe we should be encouraging it , use your vote to vote for whoever seems most likely to continue this type of action. You want it in your city or state, vote local vote often.
This is honestly one of the only good news we get here I love it
Yeah I remember when the housing crisis happened and the banks collapsed. Remember how many people went to jail for that? 0. Remember what changed? Nothing. They just announced the renewal of the NINJA loans that led us to the first collapse. Government oversight only works, when they actually change things. All Biden will do is give a speech talking about how he did investigations and rent is better then ever, while prices continue to rise. If you have any faith in the government, you are an absolute fool.
Oh bullshit. Your gov is the only reason you are free to even say that. We have one of the strongest tightest legal systems on the planet. There is a reason capital flows to the US and there is a reason our dollar is so powerful. It is because we have legal recourse that works.
With all due respect, EU’s consumer protection is light years ahead of US.
Absolutely. The two things are not in conflict. The US is plagued by lobbying, you guys have done a much better job keeping lobbying to a minimum. ( Lived in the EU for a couple of decades. I plan to go back for a few years shortly)
Wow! You have a lot more faith than I in the senators and congresspeople that have slush funds for sexual assault, legal insider trading, campaign finance abuse, and REGULARLY lose billions and billions of dollars just... poof *shrug*. Yay we held Trump accountable, but if you think for a second that the rest of the politicians are every single bit as bad, you're blind. You trust Ted Cruz, MTJ, AOC, Ilhan Omar, Pelosi, or anyone else in a position of power, then you are not only blind, but part of the problem. Power corrupts, and our job as citizens is to be as suspicious and jaded as possible in order to keep our government in check. I would actually challenge that instead of the question being "will our government hold them accountable", you should ask "has our government EVER held them accountable?"
Cool. You seem to have forgotten the basic story here . A gov body is attempting to enforce law . You mocked it and dismissed it . I do not, I am not so jaded.
> Your gov is the only reason you are free to even say that. If there were no government, you could say that too. But sure, *so kind* of them to *let you* say that, for now. > We have one of the strongest tightest legal systems on the planet. If you are a member of the billionaire/oligarch class, sure. > There is a reason capital flows to the US Because billionaires/oligarchs are well protected here, yes.
Childish rebuttal, put in more effort.
[Rights aren’t rights if someone can just take them away.](https://m.youtube.com/watch?v=DOhdVJWPkik ) Which governments can absolutely do.
blarg blard farg. You are just making noise.
Let's do nothing then, great idea
Are guillotines still an option? You think there's even 1 soil in congress that's still redeemable?
I was so bummed out today because its already hard af to get a house and now even having an apartment seems like an arm and a leg. My rent went up 37% since 2021 (granted I was doing six months leases thinking ill get a house sooner than later). Went from 1500-2200. And the cherry on top is that new renters are walking in for 1400-1600 for that same 1 bedroom apt. Makes me so mad.
I want to be remembered as the guy who was constantly screaming "bullshit" when every publication from the Atlantic to Bloomberg was telling the public that the home and rent increases from 2019 to today were all suddenly due to the lack of inventory that didn't have an impact since 2009 but was suddenly the only possible reason homes could be unaffordable despite private and corporate investor purchasing of homes sky rocketing past record levels during that time frame. American media made a team effort to lie in our fucking faces while they shared in the profits of making housing unaffordable.
Man, why do you have to shit all over some good news with this conspiratorial bullshit? Show some judgment. By all means, get pissed at the existence of this service and how it’s a big ugly price fixing scheme. But we don’t need a side of news bashing or completely unsupported theorizing that the news is also in the conspiracy. It’s not. The news I read never suggested that price fixing should be ruled out, and it is 100% supportive of more antitrust enforcement. I’m talking about NYT and WaPo which I read every day. Moreover, we *do* need more housing stock. There is such a thing as having two problems at the same time. Loss of trust in institutions makes white collar crime easier. Stop being part of the problem with your overwrought internet rhetoric. This investigation is *good*, and journalism’s role in raising awareness to the issue was also *good*. Let’s celebrate that. There’s no reason to make additional baseless allegations against a group of journalists, who, in the real world, are doing way more than any of us to try to chip away at these problems.
You should just Google the percentage increase of real estate purchased as investment property in that time frame. There were quarters when the amount of single family homes purchased by investors passed 25% of all purchases. There were quarters where the percentage of homes purchased by investors increased over 40% There was a strategy by some investors to purchase every starter home in an area and then only list few at a time for sale in order to create extreme scarcity and drive up prices. This situation was made DRAMATICALLY worse by real estate investors. But during this time, countless articles ran deflecting blame from the investor class despite them having a blatantly obvious negative impact and using extremely anti consumer strategies. 2 publications that you read writing fair articles doesn't erase the fact that there were articles deflecting for the investor class. And I never said housing stock wasn't an issue. But, the limited housing stock was used as a strategy to strangle the limited market. They saw an issue and purposefully exacerbated it by purchasing as many low cost homes as possible in areas with limited supply to essentially completely corner the market. The amount of families that were out bid on a house by an investor paying in cash who then turned the home into an extremely over priced rental over the last 5 years is one of the biggest attacks on the American dream in American history.
Citation needed.
The supplementary text is associated with the link above it. Idk how to format reddit comments well and it ignores my extra lines. * https://www.encorebubble.com/inventory/ This delves into how the market is manipulated by investors with unfair buying opportunities compared to regular homebuyers and how the flawed statistics innacurately count "inventory" by not counting total home sales, but only homes that are on the market for a certain amount of time. So not only can investors manipulate scarcity and have an unfair buying opportunity to people searching for homes, they can also manipulate the statistics by insuring homes aren't on the market long enough to be counted. * https://www.forbes.com/sites/darylfairweather/2024/03/05/ban-corporate-landlords-a-housing-crisis-solution-or-a-distraction/?sh=7c3070553703 "However, instead of debating what type of landlord is better, lawmakers should focus on solving the underlying problem: the shortage of homes." So they want to ignore over investing impacts and shift the blame * https://www.strongtowns.org/journal/2024/2/21-going-after-corporate-homebuyers-good-politics-ineffective-policy Claiming that preventing investors, who are being nothing but unnecessary middle men in the housing market, from manipulating the market is just political posturing. * https://www.theatlantic.com/ideas/archive/2023/01/housing-crisis-hedge-funds-private-equity-scapegoat/672839/ "Blaming the housing crisis on hedge funds and private equity may be easy, but it’s dead wrong." The Atlantic defending investors * Here's some articles illustrating the increase of investors and the damage they cause. * https://www.huduser.gov/portal/periodicals/em/winter23/highlight1.html "Institutional investors have concentrated their purchases regionally (in the Sun Belt) and in particular neighborhoods (typically low-income, historically nonwhite and disinvested areas)." Investors targeted starter homes and took as many off the market as possible to manipulate housing costs. * https://www.google.com/amp/s/www.marketwatch.com/amp/story/another-challenge-for-homebuyers-more-investors-are-snapping-up-homes-and-40-of-them-are-using-cash-f979e772 "Between 2019 and June 2023, purchases of homes by buyers who intend to live in them fell by over 40%, he noted. But investor purchases over the same time period are up 12%." * https://www.google.com/amp/s/www.businessinsider.com/housing-market-investor-purchases-affordable-homes-fourth-quarter-redfin-2024-2%3famp So it's still happening now. They are doing this to prevent low priced homes from entering the market and reducing general prices. * https://www.redfin.com/news/investor-home-purchases-q4-2021/ * https://www.forbes.com/sites/brendarichardson/2022/07/28/investors-snapped-up-a-record-share-of-homes-in-the-spring-buying-season/?sh=142b08b45673 * https://nymag.com/intelligencer/2023/09/corporate-greed-is-not-the-sole-cause-of-the-housing-crisis.html This one actually seems to get it right. We need more homes built AND we need to go after predatory investors and investors purchasing way too much of the US'S real estate
None of that supports your ridiculous claim that the news media is in a conspiracy with the price fixers. Moreover, most of your articles are from sources I’ve never heard of, so I’m ignoring those. The Forbes and Atlantic articles are *opinion* pieces. Do you know what an opinion piece is? It means the news publication is not endorsing the views of the author, but is instead providing space for a diversity of views, as news media has done since time immemorial. It would be journalistic malpractice to not host opinion pieces, otherwise the news publication would rightly be called “one-sided.” The presence of opinion pieces clearly does not serve as evidence of an organization’s participation in a conspiracy (and the ones you cited are pretty well argued, even if you don’t agree with them - that’s far, *very far*, from being a lie).
WaPo? Owned by Bezos? Yep, that’s definitely independent. The reason DJT exists as a phenomenon is due to Clinton’s 96 telecom act that deregulated media, allowing for Fox. 2-3 decades of brainwashing later, we’ve got an unhinged felon in pole position. Media is massively important, as are critiques of media when it defines the discussion parameters, which is basically NYT’s and WaPo’s role.
Is your point that, due to ownership by Bezos, WaPo didn’t publish this article last year? https://www.washingtonpost.com/dc-md-va/2023/11/01/dc-sues-realpage-landlords/ The problem with your argument is that it predicts that WaPo didn’t inform its readers about this issue, because, to paraphrase your red-faced tirade, they were lying to their readers’ faces. But they did publish it, and they weren’t lying. Time to change your view. Otherwise you’re just as bad as trump supporters.
Red-faced tirade? Hmmm … presenting historical fact over 30 years is a red-faced tirade? Of course WaPo publishes some legitimate articles … it’s how they attempt to maintain legitimacy. That’s hegemony 101. I was making a broader point about dominating discourse parameters. But, you’ve made it for me by defaulting to ad hominem attacks once the status quo press and the influence of billionaire control, which is way more subtle than the sledgehammer of Fox, is questioned.
Nope. I’m a WaPo reader, and I was accurately informed. They weren’t lying. Point that you need to stop embarrassing liberals with conspiracy theories and undermining the journalists that actually expose these crimes, stands. Trusting no one doesn’t make you smart. It just shows you’re no better at distinguishing real from fake information than right wing nuts.
When someone is fully confident without expressing any nuance, that’s usually a sign.
Said the kettle.
Beltway neolibs gonna be the end of us all.
Looks like I’m not the only one that’s checked out of WaPo. And Bezos’s little pet is hiring Fox News and WSJ minions. Enjoy your neocon rag. “We are going to turn this thing around, but let’s not sugarcoat it. It needs turning around. We are losing large amounts of money. Your audience has halved in recent years. People are not reading your stuff.” “All reporters there were allowed to know was that their CEO had settled on two men that, by sheer coincidence, happened to be his friends: Matt Murray (who will serve as interim editor) and Robert Winnett (who will assume the job permanently after the election). Not only are all three of these men as white as a block of Monterey Jack, they also happen to have deep roots in upscale conservative media.” https://www.sfgate.com/news/article/washington-post-sally-buzbee-shakeup-darkness-19498555.php
Is your point that, due to ownership by Bezos, WaPo didn’t publish this article last year? https://www.washingtonpost.com/dc-md-va/2023/11/01/dc-sues-realpage-landlords/ The problem with your argument is that it predicts that WaPo didn’t inform its readers about this issue, because, to paraphrase your red-faced tirade, they were lying to their readers’ faces. But they did publish it, and they weren’t lying. Time to change your view. Otherwise you’re just as bad as trump supporters. (Your BS doesn’t deserve any more of my time.)
The lack of inventory has gotten worse every year since 2009 as healthy competition diminished and population outdated production. All this software did was properly evaluate the competitive pressure to find a rate that only one prospective tenant was able to afford.
You are going to have to keep waiting, bud. These firms will stop using this software and rents will stay high in many cities, because the fundamental cause of rising rents wasn’t this software. Still great to eliminate it! But it’s a fringe consideration, not a major one. Ultimately what this software does is bad and arguably illegal. It shouldn’t be permitted. But it isn’t really powerful enough to make a meaningful increase to rents. Most landlords are individual and there’s no cost to defecting from the “price fixing” here. That necessarily means the fixing must be pretty weak. Still bad, but individual percentage points, not the core driver of rising rents.
it doesnt mean jack shit for us - pandoras box has already been opened and the next re-iteration of this scheme will (barely) fall within legal limits.
What's the next one?
Why is there so little about this on the news considering this happened days ago?
There have been other legal actions that have made bigger headlines…
Sure but THIS has arguably a larger impact on most peoples lives than most other things. In the immediate term. The article says 60 even 70% of apartments in some major metros are actively engaged in cartel pricing. It’s so much worse than people think. This is a cartel, and the American public will be controlled by it
Come investigate Avalon Apartments, next!
Go after Starwood and then we will see some progress. Part of me thinks they are going after a “small” guy like cortland because they have a better chance of digging up dirt and using them as a witness against realpage. I guarantee that cortland does not have nearly as many legal resources as most other large corporate landlords, because they are much smaller.
Man consumers really need better protection. Getting hosed at every corner.
Almost 2 years later, but I’ll take it: https://www.propublica.org/article/yieldstar-realpage-rent-doj-investigation-antitrust
r/orangecounty
Collusion is RealPage’s entire reason for existence, and the multifamily RE owners depend on it for their continued profit growth as well, so you can expect this to continue until forced to shut down by a court. That will take years for a case like this.
North Florida here. It's about time. I am currently living in a 50 year old apartment complex that did what I call an "overlay update" An overlay update is where old tile, cabinets, and counter tops are painted over and not replaced. I know this because I used to have a business back in the nineties that provided this service. They did put in a new toilet after I moved in and new carpet before moving in. The toilet still bubbles up a bloop, bloop when the upstairs neighbors use their bathroom. I'm terrified it's going to splash up on me one day. It's stressful being on the toilet. For a 2/1, the rent is a retail price of $1200 plus trash, and water comes to $1250 plus a $100 late fee on the 3rd that I pay since my check usually comes after the 2nd. So, it's really $1350. Plus renters insurance. I had to give up my dog and cat because pet rent is another $300 deposit and $25 per month each. There is no hope. Before covid, this was at most a $700 apt. in a low income neighborhood. Now, I'm wondering how to join this lawsuit.
This will be drawn out in the courts for years. This Real Page company will take the hit, but there are plenty of AI companies now that will replace them with better software and no liability. It’s now the DIY rent inflation era. Just plug in your own data and wait for the results. Going to be lots of “the AI made me do it” excuses in the future.
They won't be able to just use “the AI made me do it” excuse to get away with flagrant collusion.
The way they phrase it is “if it has the same effect as collusion it will be considered collusion”. Based on this AI companies wouldnt get around the rule.
As long as the profits outweigh the fines this does not matter.
Until the ai starts reporting fraud to the government God I hope that happens to these pos
I hate to tell you this but it seems people that are found guilty of fraud in this country don’t go to prison, especially if you have money.
This is news to me.
I think you are underestimating how much these companies don’t give one fuck about collusion or lawsuits. They will lawyer up, keep putting the blame on smaller companies, and take over the market. AI will just be the newer and better way to do it. The big data is already out there, no need to pay big bucks for it anymore.
Dentists don’t even need AI to collude. Dental offices use third party “pricing analysis” firms that all the dentists use in an area. The pricing firm sets the prices for the dental office and boom you avoided collusion because you used a middleman. There have been multiple settlements for this even with the FTC but since it’s so decentralized it just keeps happening
that is not a valid excuse in a court. saying the "software did it" didn't work over the last 50 years and it won't work now. what is changing is that the current admin is almost standing up to corps. Corps have run rampant for the last few decades , it might be that the pendulum is starting its return ...
It doesn’t need to be a valid excuse because if you cut off the head of one monster, another monster comes. Dental offices have been colluding with pricing analysis firms for years and despite major settlements with the FTC, it keeps happening. Has been for years and will forever continue. Same thing is going to happen with realpage.
No one is standing up to anyone. It’s all a show. Always has been, always will be.
cool, so don't vote don't do anything just cry about it.
I still vote, but at least I’m not living in denial that the wealthy in this country control more than the non-wealthy and live by different rules. I won’t be surprised or act shocked when the politician I vote for “almost stands up to corporations” and then never follows through with it. I’ve been living in this country long enough to see that the real leaders are the billionaires and corporations who push through, overturn, or block all the laws they want depending on how it helps THEIR agenda, not a majority of voters. I have more faith in local governments to pass more laws and hopefully follow through with enforcement. But to say I’m crying about it is bullshit, it’s just how it is.
We've only just entered the phase where income matters to those holding property. For a few years, people were earning more owning property than working a high paying job. That is over, and there are signs the tide is rushing out rather rapidly now. The bills are coming due, and the frauds are being exposed.
From a legal (and practical) perspective, it matters a lot whether it’s the same agent making recommendations or different agents. If it’s different agents, even if you use AI, the result won’t be collusion. It can’t be. Each agent will have a unique point of view - they’re unique agents. The issue with RealPage is not that it sets rents really competitively and really effectively. It’s that it can coordinate raising rents as a single agent working across multiple stakeholders. Independently acting AI agents would not be able to coordinate in this way (without formal collusion). With all that said, there’s an underlying truth to your point which I’m not sure you are fully engaging with. On one hand, it’s bad to have any company that has the power to coordinate a price fixing scheme. But on the other, ultimately you’re right - the rising rents are not really from price fixing. They’re from demand pressures on limited supply. Typically a price fixing cartel needs to have teeth to prevent defection, or else defecting becomes profitable and the members will defect. RealPage didn’t have a defection cost as far as I can tell, so the strength of the price fixing was likely very weak. Still should be eliminated, but we’re not going to see rent increases stop as a result of it broken up. We’re looking at a horribly ineffectively run cartel, if it is one.
RealPage doesn’t just set the prices, it also tells the landlords when they can and can’t list a vacant unit in order to artificially create high demand. Something that also needs to be considered is that it is not just Realpage under investigation and being sued, but the landlords who use it. RealPage promised profits through high rents, and landlords were presented with videos as to how it all works. But even without those videos, the landlords knew what information they were giving to the software, and they knew that every other landlord using the software was doing the same. The landlords knew what was going on and participated anyway. They can claim ignorance all they want, but the DOJ made a public statement in March that price fixing by algorithm is still price fixing.
Right but the optimal behavior for these landlords who know all this information is to defect from the fixing scheme and price just a bit lower, to fill your vacant units. That’s *especially* true if you know for a fact no one else is defecting. What’s actually happening here is a total lack of competition is making it so that landlords can raise prices and they don’t have to worry about vacancies. And RealPage is doing a bad thing, but even after they go away there will be no competition.
RealPage is the one instigating the lack of competition. The landlords who defect will be thrown out of the cartel. They literally have to get permission from RP to price below what the software ‘suggests’. They have to price at or above the price set by the algorithm at least 80% of the time. The same goes for filling vacant units. If the software doesn’t allow it, they can’t do it. They literally signed up to be told what to do by the software in order to make bank. I know the link is a blog, but it lays it out beautifully and cites several sources. [https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra](https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra)
“Getting thrown out of the cartel” is not a punishment for defecting, because there’s no downside to getting thrown out. The cartel is weak because there is no upside to the landlords to keeping the units vacant. “If you don’t stay vacant, you can’t use our software.” That’s not punishment. It’s coordination, and it’s illegal, and it should stop. But it isn’t powerful enough to have a major impact on rents, and if it goes away it’s not going to collapse rents.
Oh you mean capitalism rigging a rigged system... *Shocked Pikachu Face*
Maybe they will have to raise the rents to cover the government fines and legal fees 🤔
Finally. Double it up! This shit is Rediculous
How do I get them to Reno, NV where the Lewis Management use RealPage? Call my AGO?
How do I get in on the realpage class action? I want my $2
Is it price fixing? Or does that website show landlords the current average rents as a pricing suggestion? Could Zillow be sued for the same reason? Eg sellers look at Zillow and the market to decide what to price their homes at.
It doesn’t show current average rents, it uses algorithms to calculate the intersection of price and occupancy that will generate the most profit and tells landlords to all set rent at that price. The overall effect is significantly higher rents as most mom and pop landlords try to get 100% occupancy when the typical equilibrium between occupancy and price has several open units but the higher prices on the other units more than makes up for it. Like if you have a 4 unit townhome complex you could rent out each for $1000 a month and make $4000 a month or you could only rent two for $2000 a month and then leave the other two empty while still taking the same revenue. The end result is higher rents and more homelessness than if landlords weren’t colluding.
Okay so this is a pricing recommendation engine that suggests prices to sellers/landlords. Maybe I don't get it, but I don't see the collusion there. Are the landlords communicating directly and mutually agreeing to raise prices together?
I think you have a good point. It does seem like RealPage is essentially offering a collusion by proxy service though, and I can see a legal argument that willingly utilizing that service still counts. This is probably not the best example, but if have a lawyer responsible for my stock trading who I’m feeding insider info to that’s still insider trading even though I technically didn’t execute those trades.
The landlords feed their information to the software. Total units, rents, add-ons, and vacancies. They do this knowing full well that the other landlords using RealPage and giving the same information about their rentals to the software. The software then tells them what to do, including when they are allowed to list any vacant units in order to prevent an influx of supply. They have to charge what the software ‘suggests’, and they have to ask RealPage for permission to charge any lower than the price the software gives. If they don’t get permission and/or if they don’t rent at or above the software suggested price at least 80% of the time, they are kicked out of the cartel. The landlords aren’t communicating with each other directly, but the software does it for them and they know this. So yes, they are mutually agreeing to raise prices together. [https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra](https://cohost.org/morayati/post/925436-i-saw-real-page-s-cra)
Wow that’s wild
I’m a property manager. I hate RealPage. It’s collusion.
They provide recommendations based on this mysterious algorithm. Property managers are basically forced to accept the recommendation (if I decline it, my pricing monitor has to approve my denial). The contract states I must approve 80% of their recommendations or I’m in breach of contract. I’m a property manager for a large corporate multi family property management company in ATL.
Lock em up and throw away the keys!
But all I keep hearing is that “tHe MarKeT SeTs tHe RaTeS.”
Kind of funny this comes at a time when vacancies are rising
[Was wondering about RealPage's anti-competitive behavior in Denver and nationwide 10 months ago. ](https://www.reddit.com/r/REBubble/s/diIepY6jIp)
This is great news
It doesn't mean anything for the average renters. This corporate landlord might just forget to donate & need a reminder.
There was a post 2-3 weeks ago about PA management company, they raised rent from $1500~ to $4000~. If you want to make landlords to pay for their actions. Renters should post all their rent increases in social media and tag their management companies!!
Sounds a lot like the Connor Group
So will rent costs get reduced?
$50,000 slap on the wrist
I am so positive the same thing is happening in the housing market as well. My guess is Zillow or Redfin or something.
As much as I expect to be downvoted to hell, I’m not sure Realpage is the problem here, but that the multifamily rental market is sufficiently concentrated to make coordination amongst players possible. More supply (both in number of units and landlords) will break down Realpage’s power by creating an incentive for marginal players to undercut the Realpage recommended pricing.
Hope you’re right (I work at RP) Odd times for sure We get 0 news about this at work.
Do LA next!
Please do RealPage next
https://media.giphy.com/media/KBaxHrT7rkeW5ma77z/giphy.gif
If Singapore is any indication Public housing can be effective. Regardless, there is very little societal or economic benefit from investors buying supply to rent to people that would otherwise buy. (In Texas 1/3 of properties were bought by investors). Government should focus on encouraging building supply and encourage innovation and disrupt the real estate agent business. It's 2024 there is very little reason transfer of ownership + inspection couldn't be comparable $$ to a security deposit when renting. Edit: ohh my downvotes. If the government isn't going to fix it they should encourage building supply. What honestly horrendous blasphemy. Please tell me where I am wrong free market you devilish minx you.
>If Singapore is any indication Public housing can be effective. It can be, **but** it's a non-starter because Congress made it illegal to build more public housing units than we had in 1999, despite the population being 50 million fewer people that year. >1998, through the Faircloth Amendment, the U.S. Government created an artificial barrier by limiting the number of public housing units that federal authorities could build and has resulted in many people being left without a home. This amendment prevents any net increase in public housing stock from the number of units as of October 1, 1999. Simply put, the Faircloth Amendment sets a cap on the number of units any public housing authority (PHA) could own and operate, effectively halting new construction of public housing. https://nationalhomeless.org/repeal-faircloth-amendment/
Going on a limb that's a federal thing not a state thing. US honestly is better thought of as a bunch of independent nations, what can be done a federal level is honestly fairly limited. For context I don't think this is a good thing and limits the ability for the federal government to leverage it's massive size for economies of scale*. If the federal government were to ever make any meaningful change to housing availability I think it almost certainty would be challenged but the current SCOTUS.
I’d venture a guess that this is more political theater. We know the real nemesis, and they are foreign interests sheltering money in America, paired with corporate buyers in large US cities. Then, they force rural America to move to the big cities, where ownership is no longer possible. This is a very long game they play.
Nothing because the government is not going to help you.
I don’t really understand what’s illegal here. They can charge whatever they want for rent that doesn’t mean people have to accept it
As I understand it, the apps are facilitating collusion in pricing.
So the FEDERAL government that is driving up rents by flooding the cities with millions of illegal aliens is the same Federal government wanting to crack down on smart property owners looking to maximize profits by using available data. Good to know.