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DOJ sues realpage for algorithmic pricing scheme that harms renters

justice.gov

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Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#31

Post by deepsun »

Manuel_D wrote: post #25
Carrok wrote: post #23

Earlier quoted context omitted.

> industry The fact that providing people with housing is even seen as an "industry" is a big sign of what is wrong with the world right now. It is essential to living a decent life. It should not be a driver of lining the pockets of people who are already rich.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

> If there's no profit to be made in building housing, why would anyone want to build housing?

To live in it.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#32

Post by jmole »

Manuel_D wrote: post #25
Carrok wrote: post #23

Earlier quoted context omitted.

> industry The fact that providing people with housing is even seen as an "industry" is a big sign of what is wrong with the world right now. It is essential to living a decent life. It should not be a driver of lining the pockets of people who are already rich.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

There is a lot more to San Francisco's housing crisis than price controls: lengthy permitting processes, environmental reviews, NIMBY community outreach, etc.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#33

Post by Carrok »

Manuel_D wrote: post #25
Carrok wrote: post #23

Earlier quoted context omitted.

> industry The fact that providing people with housing is even seen as an "industry" is a big sign of what is wrong with the world right now. It is essential to living a decent life. It should not be a driver of lining the pockets of people who are already rich.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

If price controls on housing exist in SF but not elsewhere, and this causes developers to not build there, then the issue is not that price controls exist in SF. The issue is that price controls do not exist elsewhere.

Set the same price controls across the entire nation, suddenly there is no disincentive to not build in any one area.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#34

Post by itake »

toomuchtodo wrote: post #28
Manuel_D wrote: post #25

Earlier quoted context omitted.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

Profits are fine, excessive profits at the cost of people who need housing are not. There is no silver bullet, but increasing supply along with strong regulation to protect renters is welcome vs them being cattle to be squeezed by for profit entities. Human rights are a thing, there is no right to profit. > The six largest publicly traded apartment companies in the U.S. — all of which are linked to an alleged rental…

strong regulation increases costs (see all the permits and surveys required in SF).

What are "excessive profits"? 10%? 15%? 25%?

> experienced profit increases during the first three months of the year

Does this even mean anything? This could mean their vacancy rate decreased and thus their business is more profitable. I don't see the issue with companies reducing vacancies and providing more housing to more people.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#35

Post by toomuchtodo »

itake wrote: post #34
toomuchtodo wrote: post #28

Earlier quoted context omitted.

Profits are fine, excessive profits at the cost of people who need housing are not. There is no silver bullet, but increasing supply along with strong regulation to protect renters is welcome vs them being cattle to be squeezed by for profit entities. Human rights are a thing, there is no right to profit. > The six largest publicly traded apartment companies in the U.S. — all of which are linked to an alleged rental…

strong regulation increases costs (see all the permits and surveys required in SF). What are "excessive profits"? 10%? 15%? 25%? > experienced profit increases during the first three months of the year Does this even mean anything? This could mean their vacancy rate decreased and thus their business is more profitable. I don't see the issue with companies reducing vacancies and providing more housing to more people.

I cannot say, but experts can, and suggest to legislators and regulators implementation details. To operate a business in a jurisdiction is a privilege, not an entitlement.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#36

Post by from-nibly »

deepsun wrote: post #31
Manuel_D wrote: post #25

Earlier quoted context omitted.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

> If there's no profit to be made in building housing, why would anyone want to build housing? To live in it.

You want to live in an apartment complex by yourself?

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#37

Post by BobbyJo »

Manuel_D wrote: post #25
Carrok wrote: post #23

Earlier quoted context omitted.

> industry The fact that providing people with housing is even seen as an "industry" is a big sign of what is wrong with the world right now. It is essential to living a decent life. It should not be a driver of lining the pockets of people who are already rich.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

I agree with most of what you said, and do think supply is ultimately the fix, however, we also have to acknowledge the extreme inelasticity of demand for housing, and the massive shoe leather cost, both of which leave consumers at a massive disadvantage in price discovery.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#38

Post by Quinner »

Carrok wrote: post #33
Manuel_D wrote: post #25

Earlier quoted context omitted.

Do you want to invest tens of millions of dollars into building an apartment with zero expectations of making a return? If there's no profit to be made in building housing, why would anyone want to build housing? This line of thinking is what leads to situations like San Francisco, where price controls on housing lead to few developers willing to build there. If it's proven that landlords colluded to fix prices, that…

If price controls on housing exist in SF but not elsewhere, and this causes developers to not build there, then the issue is not that price controls exist in SF. The issue is that price controls do not exist elsewhere. Set the same price controls across the entire nation, suddenly there is no disincentive to not build in any one area.

Suddenly there's no incentive to build in all areas.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#39

Post by legitster »

Carrok wrote: post #23
lukev wrote: post #16

Some quotes from the filing: > Discussing a different RealPage product, another landlord said: “I always liked this product because your algorithm uses proprietary data from other subscribers to suggest rents and term. That’s classic price fixing . . . .” > In fact, as RealPage’s Vice President of Revenue Management Advisory Services described, “there is greater good in everybody succeeding versus essentially trying…

> industry The fact that providing people with housing is even seen as an "industry" is a big sign of what is wrong with the world right now. It is essential to living a decent life. It should not be a driver of lining the pockets of people who are already rich.

Modern housing is a direct development of the industrial revolution. In that sense it is an industry.

You could provide housing like undeveloped nations do, where large families live in cramped hovels without electricity or running water.

In the sense that someone should want an apartment with 2 bathrooms, a fireplace, and a pool - it's easier to treat housing overall as a consumer good.

Re: DOJ sues realpage for algorithmic pricing scheme that harms renters

#40

Post by Sohcahtoa82 »

legitster wrote: post #30

I am a small-time landlord. There's no "marginal cost" to determine how much to charge for rent. The only thing I use to determine the price is the current market rate. And all I have to do is open up Zillow or Craigslist and do a search on similar properties with similar characteristics. It only takes ~5 minutes of research to get a competitive market rate. While RealPage might command 80% of the market for this typ…

> While RealPage might command 80% of the market for this type of software, they only have 12,000 clients. There are over 5.2 million multi-family dwellings in the US.

That reveals a startling statistic that 80% of the market is controlled by only 12,000 users. That's 433 units per user on average.

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