We need a massive effort to enforce the Sherman Act against landlords. Both breakups and criminal penalties need to be applied. Send some big landlords to prison for 10 years and this problem will stop.[1]
[1] https://www.nytimes.com/2024/07/19/business/economy/rent-pri...
What is happening in the Bay Area is large corporations are using 3rd party exchanges that make following the price guidelines a requirement to participate. The 3rd party is paid to set the regional prices. And they all win through fee's and higher rent prices.
Its old fashion collusion. Using the word algorithm obfuscates the simplicity in the criminal activity.
Related FBI raids Atlanta corporate landlord in probe of rental market price fixing (252 points, 2 months ago, 266 comments) https://news.ycombinator.com/item?id=40580874
https://web.archive.org/web/20240810153028/https://www.theat... Algorithms may be allowed to facilitate price-fixing among landlords in ways that would not be allowed if done by humans.
We're really gonna exhaust every option we have before we build new housing.
In the article, one of the lawyers quoted states that "enforced compliance is the hallmark feature of any cartel."
Is that part of the legal requirements for a guilty judgement or breaking up a cartel? In the US at least? Would RealPage be fine if they treat their recommended prices as mere suggestions?
These algorithms have an economic incentive to suggest higher rents, because that's what the customer (landlords) want to hear. If the algorithm calculates a rent 30% lower than the previous tenant was paying, landlords will either ignore the recommendation or shop around for another startup with an algorithm that tells them what they want to hear.
I own a rental property. This is how it works for me: Tenants move out. I look at how much similar property is renting for in the area. I advertise at about that rent. Usually a bit lower. Prospective tenants agree to to rent at that price.
I don't control prices. That is supply and demand.
Software that looks at rents in area and suggests a price just sounds like automation of what I do manually.
Same thing happens in reverse with salaries. Glassdoor isn't your friend, it just helps companies regress to the 50th-percentile.
Haven’t we been this for a few years now. Is it news anymore?
there needs to be adequate public housing for people that can't afford this bs. then landlords can do what they want, let the market decide, but basic housing for people should be a priority.
It is completely anecdotal but in my local experience I've seen the following pattern happen: rent is increased substantially, present tenants move out, no one new applies, unit becomes empty, rent is decreased until someone new finally moves in. I'm not a landlord but I don't think there is a rational basis for kicking all of your rent paying tenants out and then having half a dozen units go empty in the hope that you can squeeze an extra 100 every month out of someone, maybe, in the future.