The U.S. Division of Justice and eight states sued RealPage on Friday, accusing the property administration software program firm of utilizing algorithms to assist landlords illegally collude and drive up rents for flats.
The lawsuit filed in North Carolina accuses Dallas, Texas-headquartered RealPage of letting landlords collude by sharing their pricing data with the corporate’s software program, which then recommends lease costs. The software program retains landlords from decreasing lease and providing offers to draw renters, the Justice Division mentioned.
Excessive housing prices are a key concern for U.S. customers forward of the November presidential election, with house costs rising nationally by about 50% and lease going up round 35% within the final 5 years, in keeping with actual property service agency Zillow.
The case is the primary time the Justice Division has gone after algorithmic collusion, a rising concern for antitrust enforcers as know-how firms supply pricing providers primarily based on large information.
“Individuals shouldn’t should pay extra in lease as a result of an organization has discovered a brand new approach to scheme with landlords to interrupt the legislation,” Lawyer Common Merrick Garland mentioned in a press release.
The Justice Division factors to statements by RealPage executives that it says present they realized they have been serving to to dampen competitors within the rental housing market.
“There’s larger good in everyone succeeding versus basically attempting to compete towards each other in a method that truly retains all the trade down,” one govt mentioned, in keeping with the Justice Division.
The Justice Division additionally accuses RealPage of illegally monopolizing the marketplace for property administration software program for multi-family dwellings within the U.S.
The attorneys basic of North Carolina, California, Colorado, Connecticut, Minnesota, Oregon, Tennessee, and Washington joined the Justice Division within the case.
The lawsuit follows related instances the place the lawyer basic for Washington D.C. and renters say RealPage illegally drove up rents.
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