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US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

klobuchar.senate.gov

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Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#111

Post by Aunche »

ceejayoz wrote: post #102
Aunche wrote: post #88

Earlier quoted context omitted.

> The program may also induce landlords to charge the rents recommended by the algorithm, putting upward pressure on prices and decreasing the availability of affordable apartments. This is definitely nonsense grandstanding. I have no idea what they're even trying to say here. The program may also induce landlords to decrease rents as recommended by the algorithm, putting downward pressure on prices and increasing th…

> The program may also induce landlords to decrease rents as recommended by the algorithm... The algorithm's sole purpose - how it gets customers and makes money - is to maximize revenue and prevent that as much as possible.

Reducing rents may also maximize revenue by reducing vacancy. The reason the algorithm recommends landlords to increase rents more often than it recommends them to decrease rents is because the supply of housing isn't growing as quickly as demand. Without this algorithm, landlords tends to set rents in reactive manner, so the price they set lags behind the optimal market price, so when the algorithm recommends the market rent, it tends to be higher.

Unfortunately, the state of economic education is so poor in this country that Senators would rather grandstand about making economic signals illegal rather than actually address the root cause of these economic signals.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#112

Post by ceejayoz »

Aunche wrote: post #111
ceejayoz wrote: post #102

Earlier quoted context omitted.

> The program may also induce landlords to decrease rents as recommended by the algorithm... The algorithm's sole purpose - how it gets customers and makes money - is to maximize revenue and prevent that as much as possible.

Reducing rents may also maximize revenue by reducing vacancy. The reason the algorithm recommends landlords to increase rents more often than it recommends them to decrease rents is because the supply of housing isn't growing as quickly as demand. Without this algorithm, landlords tends to set rents in reactive manner, so the price they set lags behind the optimal market price, so when the algorithm recommends the ma…

> Reducing rents may also maximize revenue by reducing vacancy.

Actually, the algorithm seems to do the opposite.

https://www.propublica.org/article/yieldstar-rent-increase-r...

> During an earnings call in 2017, Winn said one large property company, which managed more than 40,000 units, learned it could make more profit by operating at a lower occupancy level that “would have made management uncomfortable before,” he said.

> The company had been seeking occupancy levels of 97% or 98% in markets where it was a leader, Winn said. But when it began using YieldStar, managers saw that raising rents and leaving some apartments vacant made more money.

> “Initially, it was very hard for executives to accept that they could operate at 94% or 96% and achieve a higher NOI by increasing rents,” Winn said on the call, referring to net operating income. The company “began utilizing RealPage to operate at 95%, while seeing revenue increases of 3% to 4%.”

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#113

Post by Aunche »

ceejayoz wrote: post #112
Aunche wrote: post #111

Earlier quoted context omitted.

Reducing rents may also maximize revenue by reducing vacancy. The reason the algorithm recommends landlords to increase rents more often than it recommends them to decrease rents is because the supply of housing isn't growing as quickly as demand. Without this algorithm, landlords tends to set rents in reactive manner, so the price they set lags behind the optimal market price, so when the algorithm recommends the ma…

> Reducing rents may also maximize revenue by reducing vacancy. Actually, the algorithm seems to do the opposite. https://www.propublica.org/article/yieldstar-rent-increase-r... > During an earnings call in 2017, Winn said one large property company, which managed more than 40,000 units, learned it could make more profit by operating at a lower occupancy level that “would have made management uncomfortable before,” h…

I already addressed why this is the case in my previous comment.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#114

Post by [deleted] »

notch656a wrote: post #104
Aunche wrote: post #100

Earlier quoted context omitted.

A place to live is a market based thing. There's no real difference between what RealPage is doing with housing, and what the CME Group is doing with crops. They both facilitate price discovery. The CME also is helping farmers maximize their profits. The difference is that farmers are allowed to grow as much crops as they want (perhaps a little too much in drought-prone areas), so food prices grow much more reasonabl…

If you spend some time in South America you quickly find that most everyone can afford some type of housing, it's just a matter of how shitty it is going to end up. The vast majority of the US has set some building codes that basically say "be rich enough to build to this code or be homeless." One can debate the merits of whether the streets are safer than a sub-code house. If you go somewhere like Asuncion, Paraguay…

[deleted]

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#115

Post by ceejayoz »

admax88qqq wrote: post #106
brookst wrote: post #79

Earlier quoted context omitted.

RealPage adjusts rental property pricing daily: https://www.realpage.com/videos/yieldstar-optimizes-rent-pri...

People's rent doesn't change daily

Nor do the plane tickets I bought six months ago.

The price if you purchase today changes daily, in both scenarios.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#116

Post by gruez »

mike00632 wrote: post #62
mjevans wrote: post #40

Earlier quoted context omitted.

You're close, and those are all reasonable steps. Re 2: My test is, the owner(s) (all on the title) must _reside_ in the house for at least 35% of the year. That allows summer / winter homes for snowbirds, as well as moves, but makes it impossible to get the tax break on 3 properties in a given year. House ZONING, anti-NIMBY, is also a major contributing factor. There should be rules much more like Japan's 'impact ba…

I don't even have a single house and you're worried about a second house being taxed too much?

That might be true, but depending on the area you live in the amount of people with 2 homes might be a big/politically active enough voting bloc that can sink any legislation. If that's the case it's better to add that exemption so you can get something passed.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#117

Post by giraffe_lady »

grecy wrote: post #51
rtpg wrote: post #44

Earlier quoted context omitted.

Hotels and flights are, granted, less essential than a place to live. Remember, you _have to live somewhere_. That is a functional difference compared to other "market-based" things (never mind that "market-based solutions" are a lot less workable when atomicity is lost. Yeah yeah, regulations making things harder to build, I think more should be built! But there are real, "wanted" things in the way of just having ma…

> Remember, you _have to live somewhere_. You also _have_ to get education, healthcare and a whole lot more than nobody is doing anything about making any kind of affordable.

On the right track keep going.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#118

Post by gruez »

jmyeet wrote: post #92
thriftwy wrote: post #29

Earlier quoted context omitted.

If you tax second homes, people will not buy these, not put them out for rent, and developers will build fewer real estate. This may only benefit if you have already borked your real estate market so that virtually nothing gets built anyway.

If you believe this I'm afraid that you have successfully been brainwashed by Atlas Shrugged propaganda that dominates American politics. It is the idea that we have to kowtow to bosses ("capitalists") otherwise they won't provide those jobs or will leave. It's a ridiculou snotion. The only thing that will stop capitalists doing capitalism is that it won't be profitable. In a lot of places we aren't building things b…

>It is the idea that we have to kowtow to bosses ("capitalists") otherwise they won't provide those jobs or will leave. It's a ridiculou snotion.

You have to "kowtow" to capitalists because they control resources which are required for new housing to get built. Nothing will change that short of a full communist revolution, which most people aren't too keen on.

>The only thing that will stop capitalists doing capitalism is that it won't be profitable.

>In a lot of places we aren't building things because we can't (eg in most of the US it is quite literally illegal to build anything other than SFHs) and what we are building in a lot of places isn't aimed at normal people (eg the ultra-luxury skinny-tall towers in Manhattan).

You got cause and effect reversed. The reason why only luxury apartments/houses are being built in those areas is because the land value/zoning means that the only rich people can pay those prices, and they want luxury homes. Mandating that only crappy homes can be built doesn't really fix the issue, because rich people will still buy those homes and renovate it themselves to make it luxury.

Re: US reps urge DOJ to investigate anticompetitive conduct affecting apartment rent

#119

Post by giraffe_lady »

Aunche wrote: post #111
ceejayoz wrote: post #102

Earlier quoted context omitted.

> The program may also induce landlords to decrease rents as recommended by the algorithm... The algorithm's sole purpose - how it gets customers and makes money - is to maximize revenue and prevent that as much as possible.

Reducing rents may also maximize revenue by reducing vacancy. The reason the algorithm recommends landlords to increase rents more often than it recommends them to decrease rents is because the supply of housing isn't growing as quickly as demand. Without this algorithm, landlords tends to set rents in reactive manner, so the price they set lags behind the optimal market price, so when the algorithm recommends the ma…

> Reducing rents may also maximize revenue by reducing vacancy.

Yeah but come on were you born yesterday.

> The reason the algorithm recommends landlords to increase rents more often than it recommends them to decrease rents

The algorithm causing landlords to raise rents is the problem with the use of the algorithm, the subject of discussion. The mechanics of how the algorithm comes to that conclusion may be technically interesting but are not the problem, nor the solution, to rents being raised.

We can solve the underlying problem and ban this shit. We don't have to choose one neither blocks us from dealing with the other. This is happening now and would be easy to stop, if we wanted to. What do you gain from making people think we can't or shouldn't stop this?

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