Company that makes rent-setting software for landlords sued for collusion

RealPage worked with some of the nation’s largest landlords to raise rents, says lawsuit.

Read the whole story

 

[rnturn]

I don't think it's so similar. In the gas station situation, the buyer and the seller have access to the same information, not in the apartment renting situation.

That may depend on your location. Around here (Chicago 'burbs) there are times when gas prices all seem to rise and fall in lockstep. A penny or two difference in prices -- except for the stations near the expressways (always higher priced) -- is often the best you can hope for and a difference of less then $0.50 for a fill-up is, basically, nothing.

 

[rnturn]

But this does seem like something "in between". When the software is used by ALL the major market players, and the software maker "strongly recommends" not diverging from the suggested rental, that seems like the companies involved are NOT optimizing for their own utility functions, but rather effectively turning over pricing decisions to a "third party cartel administrator" which explicitly seems to take advantage of the cartel power.

The software is the one making the recommendation based on all the competitors' pricing so the individual landlords can all, effectively, say "We did not have this conversation".

 

[rnturn]

The problem with the software isn't that the prices of competitors are identified, it's the encouragement to keep units off the market. That discourages competition.

It sure appears that it's designed (in part) to create an artificial scarcity which is then used as a reason to jack up rents.

 

[rnturn]

Just having the software wont be enough proof for court. It will have to be shown that they did use it to cartel and not compete.

Ah, so they'll play the "prove our state of mind" card in court.

 

[rnturn]

If an 800 square foot apartment in a complex with minimal amenities is renting at the cap then what happens to your 1200 square foot units in the same complex? That one should be worth more, but you'd be capped and have to rent it at the same price.

And then what about the complex across the street that also has a 1200 square foot apartment, but they have a pool and a gym and tennis courts and covered parking modern updated appliances and in-unit laundry and EV charging, etc? Clearly this one is worth even more, but nope, at the cap so it is the same price as the bare-bones 800 square foot place.

So a rent cap wouldn't take into account square footage? What bonehead city would try and enforce a cap like that?