A wave of class-action lawsuits is sweeping through the U.S. rental market as tenants accuse corporate landlords of engaging in a price-fixing conspiracy using real estate software. Allegations point to software provider RealPage and 34 co-defendant landlords, with the U.S. Department of Justice expressing interest in the case, asserting Sherman Antitrust Act violations.<\/p>\n
Key Points from the Lawsuits:<\/p>\n
1. Inflated Rent Hikes:
\n\u2013 U.S. renters claim that landlords are utilizing software, specifically RealPage, to deliver inflated rent hikes.
\n\u2013 Tenants allege that management, including Equity Residential, started implementing substantial price increases after offering concessions during the Covid-19 pandemic.<\/p>\n
2. Class-Action Lawsuits:
\n\u2013 Tenants at Portside Towers, a 527-unit building in Jersey City, are involved in a sprawling class-action lawsuit against RealPage and 34 co-defendant landlords.
\n\u2013 The U.S. Department of Justice filed a statement of interest, supporting the tenants and arguing Sherman Antitrust Act violations.<\/p>\n
3. Attorney General Complaint:
\n\u2013 In November 2023, the attorney general of Washington, D.C., filed a complaint against RealPage and 14 landlords managing over 50,000 apartment units in the District.
\n\u2013 The complaint alleges RealPage facilitates a housing cartel, claiming landlords share competitively sensitive data through the software, leading to artificially high rents.<\/p>\n
4. Antitrust Grounds:
\n\u2013 The Attorney General of the District of Columbia, Brian Schwalb, accuses RealPage of facilitating a housing cartel and asserts that landlords are compelled to charge rents dictated by RealPage, violating antitrust laws.<\/p>\n
5. RealPage\u2019s Defense:
\n\u2013 RealPage defends its revenue management products, stating they use anonymized, aggregated data to deliver pricing recommendations on approximately 4.5 million U.S. housing units.
\n\u2013 The company claims its tools can increase landlord revenues between 2% and 7% and emphasizes that landlord customers are not obligated to follow price suggestions.<\/p>\n
6. YieldStar Software:<\/p>\n
-One of RealPage\u2019s key revenue management tools, YieldStar, balances prices, occupancy, and lease lengths to help property managers optimize their portfolio\u2019s yield.
\n\u2013 Former RealPage employee Jeffrey Roper emphasizes the efficiency of the software, claiming it outperforms manual analysis.<\/p>\n
7. Tenant Awareness:
\n\u2013 Renters became aware of the use of revenue management software in real estate through a 2022 ProPublica investigation.
\n\u2013 Equity Residential investor materials indicate experimentation with Lease Rent Options, with RealPage acquiring the product in 2017.<\/p>\n
8. Ongoing Litigation:
\n\u2013 Equity Residential and other defendant landlords involved in the lawsuits declined to comment on ongoing litigation against RealPage.
\n\u2013 Thoma Bravo, the private equity firm that acquired RealPage for $10.2 billion in 2021, claims it is not liable for alleged acts outlined by plaintiffs.<\/p>\n
9. Rent Market Dynamics:
\n\u2013 Redfin reports a decline in U.S. asking rents to $1,964 a month in December 2023.
\n\u2013 Analysts note that while prices are decreasing in certain markets, well-located landlords on the U.S. East Coast may have increased pricing power due to low rates of homebuilding.<\/p>\n
10. Equity Residential CEO\u2019s Perspective:
\n\u2013 Equity Residential CEO Mark Parrell suggests that landlords with strategically located apartments remain in a favorable position despite market fluctuations.<\/p>\n","protected":false},"excerpt":{"rendered":"
Class-Action Lawsuits Accuse RealPage and Landlords of Unfairly Boosting Rental Prices, Prompting Department of Justice Intervention<\/p>\n","protected":false},"author":331,"featured_media":30023,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[82],"tags":[6819,217,9639,95],"class_list":["post-30065","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate","tag-houses","tag-real-estate","tag-rental-market","tag-usa"],"reading_time":"3 min read","_links":{"self":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/30065","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/users\/331"}],"replies":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/comments?post=30065"}],"version-history":[{"count":0,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/30065\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media\/30023"}],"wp:attachment":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media?parent=30065"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/categories?post=30065"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/tags?post=30065"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}