Senators urge DOJ to scrutinize landlords’ use of RealPage tool to lift rents

for rent
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4 U.S. senators are calling at the Justice Division to appear intently at how Richardson-based RealPage’s tool is utilized by giant landlords.

Democratic Sens. Elizabeth Warren, Tina Smith, Bernie Sanders and Ed Markey despatched a letter March 2 to Assistant Legal professional Common Jonathan Kanter on their issues in regards to the function algorithmic rent-setting tool similar to RealPage’s YieldStar performs in surroundings costs for condominium homes.

The letter comes after ProPublica printed an investigation on using RealPage’s tool by means of landlords in October. In November, the Division of Justice opened an investigation into whether or not RealPage is facilitating collusion amongst landlords as questions arose a few 2017 merger between RealPage and its biggest pricing competitor, ProPublica reported.

“The upward push of institutional traders and rent-setting algorithms have weakened festival within the already strained housing marketplace, leading to substandard products and services and unnecessarily prime housing prices for American households,” the senators wrote. “It’s due to this fact very important that the dep. use all of its equipment to make sure that renters don’t fall sufferer to company landlords and anti-competitive forces.”

The senators opened their very own investigation into YieldStar in November, asking for data on how the rent-setting tool has affected the condominium housing marketplace.

They stated the corporate didn’t supply them with the entire data they asked however famous that RealPage’s web site states its revenue-management tool is used for greater than 4 million devices and components in rent transaction information for greater than 13 million devices.

The senators wrote that data supplied to them by means of RealPage additionally published that using YieldStar has been maximum prevalent in one of the areas maximum closely centered by means of company patrons and with the best hire will increase.

“Even the popular use of its anonymized and aggregated proprietary condominium information by means of the rustic’s biggest landlords may lead to de-facto price-setting by means of the ones corporations, riding up costs and hurting renters,” the senators wrote. “Given those findings, the DOJ will have to act to give protection to American households and intently overview rent-setting algorithms like YieldStar to resolve if they’re having anti-competitive results on native housing markets that experience observed larger institutional investor process.”

RealPage went public greater than a decade in the past in a inventory sale valued at $135.3 million. It was once bought and brought non-public by means of non-public fairness funding company Thoma Bravo in a $10.2 billion deal in 2021.

In a observation supplied to The Information in line with the senators’ letter, RealPage stated, “RealPage appreciates the chance to paintings with the senators’ workplaces and, extra in most cases, we’re at all times keen to interact coverage stakeholders to make sure an educated and complete figuring out of the advantages we give a contribution to the condominium ecosystem.”

Foremost Deputy Legal professional Common Doha Mekki stated at an antitrust convention in Miami in February that the Justice Division’s antitrust department was once taking flight steering issued between 1993 and 2011 that defined permissible habits associated with data sharing, Bloomberg Regulation reported.

“This steering supplied a protected harbor to corporations like RealPage, and we now know—in line with the findings of our investigation—that protected harbor will have supplied doable alternatives for de facto collusion and worth surroundings,” the senators wrote of their letter.

In keeping with Bloomberg Regulation, Mekki stated the larger use of algorithms, the velocity of information and the power of corporations to de-anonymize delicate data require new scrutiny.

2023 The Dallas Morning Information.
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Senators urge DOJ to scrutinize landlords’ use of RealPage tool to lift rents (2023, March 9)
retrieved 6 April 2023

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