DENVER (AP) — The U.S. Department of Justice says the U.S. Department of Justice allegedly orchestrated rent-setting efforts to keep Americans’ rents high by using algorithms to help set rents and privately sharing sensitive information with competitors to increase profits. He has sued several large landlords.
The lawsuit was filed as renters in the United States continue to struggle in an unforgiving housing market, with incomes unable to keep up with rising rents. According to the latest statistics, half of U.S. renters will spend more than 30% of their income on rent and utilities in 2022, a record high.
That means having to make daily decisions between medicine, groceries, school supplies, and rent. That means eviction notices and lengthy court cases, and children have the highest eviction rate, with 1.5 million evicted each year, according to the Princeton University Eviction Institute.
The housing crisis has several possible causes, including a slump in housing construction over the past decade, but the Justice Department’s lawsuit alleges that large landlords are contributing.
The department has accused six landlords, which collectively operate more than 1.3 million units in 43 states and the District of Columbia, along with 10 states including North Carolina, Tennessee, Colorado and California, of conspiring to avoid rent reductions. I am doing it.
The landlord, Greystar Real Estate Partners LLC, which is a defendant in the lawsuit, declined a request for comment from The Associated Press but posted an unsigned statement on its website.
“Greystar has and will continue to conduct its business with the utmost integrity. Greystar has not engaged in any anti-competitive conduct,” the statement said. “We will vigorously defend this lawsuit.”
The lawsuit accuses landlords of sharing confidential rent and occupancy data with competitors via email, phone calls and groups. The information shared allegedly included update rates, how often they accepted algorithmic price recommendations, the use of concessions such as a free month, and even their pricing approach for the next quarter.
The Justice Department announced that one of the six landlords had agreed to cooperate with prosecutors. The proposed settlement would limit how the company can use competitors’ data and algorithms to set rents.
“Today’s action against RealPage and six major landlords will end their practices of putting profits over people and make housing more affordable for millions of people across the country. Doha Mekki, acting assistant attorney general for the department’s antitrust division, said in a press release on Tuesday. release.
Those landlords are Existing lawsuits against RealPageruns an algorithm that recommends rental prices to landlords. Prosecutors argue that the algorithm uses sensitive competitive information, allowing landlords to adjust prices and avoid competition that would drive down rents.
Jennifer Bowcock, RealPage’s senior vice president of communications, said in a statement to the AP that the company’s software is used in less than 10% of rental units in the U.S., and recommended prices are used in less than half. said.
“It’s past time to stop scapegoating RealPage, and now our customers, for home affordability issues when the root cause of rising home prices is a lack of housing supply,” Bowcock said. spoke.
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Bedayn is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.
