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Dive brief:
- Two US senators introduced a bill last week prevent the use of algorithmic systems increase the price of rental housing.
- If passed, the Preventing Algorithmic Facilitation of Rental Housing Cartels Act of 2024 would make it illegal for rental companies to use services that coordinate rental housing prices and information about the supply of rental housing. units It would also prohibit price coordination between two or more owners.
- The bill, authored by Sens. Ron Wyden, D-Ore., and Peter Welch, D-Vt., follows a series of judgments about whether property management software, including RealPage and Yardi products, has allowed landlords indirectly coordinate rental prices. The Department of Justice has also conducted research on RealPage’s pricing algorithm.
Diving knowledge:
RealPage and Yardi’s property management software uses price and rental information to suggest rentals to their customers. RealPage has claimed that its software allows its customers to increase rents by 5% to 12%, according to the authors of the billwhich singled out the two companies by name in a press release.
“Pricing with an algorithm is no different than pricing cigars and whiskey at a private club,” Wyden said in the statement. “While I believe these cartels are already violating existing antitrust laws, I want the law to be very clear that algorithmic rental price-fixing is a crime.”
Under the bill, a rental owner who coordinates rentals or provides information with another owner, such as through an algorithm or software, would be considered a violation of the Sherman Antitrust Act.
The legislation would also prevent two or more coordinating parties from merging if the union reduced competition and would allow individual plaintiffs to invalidate any pre-dispute arbitration agreement or joint action waiver that would prevent them from bringing suit under the act
RealPage did not respond to a request for comment on this article. Yardi declined to comment and referred Multifamily Dive to the National Council on Multifamily Housing, which also declined to comment.
Co-sponsors of the bill include Sens. Amy Klobuchar, D-Minn., Bernie Sanders, I-Vt., Mazie Hirono, D-Hawaii, Laphonza Butler, D-Calif., Jeff Merkley, D-Ore. and Richard Blumenthal. , D-Conn. It is also endorsed by the American Economic Liberties Project, the National Low Income Housing Coalition and the National Alliance to End Homelessness.
A few days ago, Wyden and Klobuchar also introduced the Algorithmic Collusion Prevention Act, which would apply similar restrictions to the use of algorithms to collude on prices across all industries.
