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Algorithmic rent-pricing litigation expands under new state and local laws

morganlewis.com

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Re: Algorithmic rent-pricing litigation expands under new state and local laws

#61

Post by nwah1 »

hdgvhicv wrote: post #38
tyre wrote: post #23

Earlier quoted context omitted.

I live in NYC, which has rent control, and the idea that a landlord would otherwise lower rent is hilarious. Landlords raise rent by the max allowed because they can. There is no “catch up” because the purpose is to protect renters against huge jumps. I think rent controlled units that sit empty should be subject to a tax based on an escalating percentage of the market rent. You can own property to rent out, but in a…

Just charge a tax on the value of the land.

Underrated comment.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#62

Post by jupp0r »

tyre wrote: post #24
Espressosaurus wrote: post #21

Earlier quoted context omitted.

If rent no longer rises then the profit doesn't rise commensurately with demand, so the money isn't there to build supply. Rent control crushes supply to the degree that the rent control caps rents below the actual market rate. If you're lucky enough to get rent controlled housing then you're in good shape. But good luck getting it when things get far enough down the timeline. Rent fixing is the other side where supp…

If rents can’t rise quickly, then the expected profit of a building goes down, which means prices for land go down, which means it is cheaper to build, which means it balances out. If the balance is far enough off that everything turns into commercial real estate, that can be solved, too.

If there is not enough supply for the demand in housing then nothing but meeting demand with new supply will solve that.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#63

Post by [deleted] »

consensus1 wrote: post #46
Nursie wrote: post #41

Earlier quoted context omitted.

In a city or country with housing shortages or a very tight market, that’s asking a lot. People need homes, and there is a balance to be struck for the public good.

The people imposing the rent control are the same people responsible for the shortage, so I just can't get behind that.

[deleted]

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#64

Post by BoiledCabbage »

Aurornis wrote: post #19
Chinjut wrote: post #9

Earlier quoted context omitted.

Why would landlords not seek the highest possible rent without rent control?

Under rent control the highest possible rent is set by laws. If you fall behind on the allowed rent increase you’re usually not allowed to catch up to market rate later, such as when your tenant leaves and you put the unit back on the market. So to avoid getting stuck at below market rate with no legal way to catch up, you have to take the maximum allowable rent increase every year. In some situations it’s better to…

> Landlords switch to raising rents in unison by the maximum allowable amount every year

Blaming this on rent control? This entire take is absurd. Because of the simple fact that landlords, especially using this software, do this in cities without rent control.

Unless now type arguing that Berkley rent control forces landlords in cities without rent control to seek maximum rents...

Rent control is flawed, limiting housing stock is flawed. But blaming landlord's pricing behavior on this is obviously false. Simply because it happens without rent control.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#65

Post by BoiledCabbage »

yonran wrote: post #40

In San Francisco, I’m not a fan of Aaron Peskin’s ban on algorithmic rent-setting (Admin Code 37.10C https://codelibrary.amlegal.com/codes/san_francisco/latest/s... ) (which is probably similar to the other cities) because 1) it goes beyond antitrust law in just banning data gathering for no good reason, and 2) it rewards bounty hunters. 1. It goes beyond antitrust guidelines by banning rent prediction using any “non…

> If landlords are pricing accurately but not monopolistically, this should reduce turnover, reduce vacancy, and...

Ah yes one of my favorite lines of argument: "We don't need laws, if companies are just behaving properly and against their financial interests to behave in a way that harms legit market pricing..."

Except as we know companies won't behave well without incentives. Which is why we need laws on it.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#66

Post by roosterIllusi0n »

Aurornis wrote: post #19
Chinjut wrote: post #9

Earlier quoted context omitted.

Why would landlords not seek the highest possible rent without rent control?

Under rent control the highest possible rent is set by laws. If you fall behind on the allowed rent increase you’re usually not allowed to catch up to market rate later, such as when your tenant leaves and you put the unit back on the market. So to avoid getting stuck at below market rate with no legal way to catch up, you have to take the maximum allowable rent increase every year. In some situations it’s better to…

Sounds like we should prevent rent increases. Fix the law, don't throw it away. Landlords that cannot afford to be landlords need to sell and go get a real job.

No one is entitled to be a lazy landlord taxing other people's existence and its extremely rare for a landlord to have built new houses, they mostly gatekeep the existing housing.

People in california need to take advantage of a populace willing to vote for constitutional amendments and override the politicians.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#67

Post by roosterIllusi0n »

JumpCrisscross wrote: post #31
tyre wrote: post #23

Earlier quoted context omitted.

I live in NYC, which has rent control, and the idea that a landlord would otherwise lower rent is hilarious. Landlords raise rent by the max allowed because they can. There is no “catch up” because the purpose is to protect renters against huge jumps. I think rent controlled units that sit empty should be subject to a tax based on an escalating percentage of the market rent. You can own property to rent out, but in a…

New York’s rent control works differently from the Bay Area’s. It’s absolutely worth it to just raise the rent on a Bay Area unit if it’s rent controlled even if that means it runs empty. That isn’t usually the case in New York.

Fix it.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#68

Post by yonran »

BoiledCabbage wrote: post #65
yonran wrote: post #40

In San Francisco, I’m not a fan of Aaron Peskin’s ban on algorithmic rent-setting (Admin Code 37.10C https://codelibrary.amlegal.com/codes/san_francisco/latest/s... ) (which is probably similar to the other cities) because 1) it goes beyond antitrust law in just banning data gathering for no good reason, and 2) it rewards bounty hunters. 1. It goes beyond antitrust guidelines by banning rent prediction using any “non…

> If landlords are pricing accurately but not monopolistically, this should reduce turnover, reduce vacancy, and... Ah yes one of my favorite lines of argument: "We don't need laws, if companies are just behaving properly and against their financial interests to behave in a way that harms legit market pricing..." Except as we know companies won't behave well without incentives. Which is why we need laws on it.

> Ah yes one of my favorite lines of argument: "We don't need laws

That’s not my argument at all. We do have federal antitrust law. My question was what does the ordinance do that differs from antitrust. The answer is that the ordinance rewards bounty hunters chasing the same federal case, and also bans non-“competitively sensitive” datasets.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#69

Post by hackable_sand »

WalterBright wrote: post #42

Governments are always unsuccessfully trying to repeal the Law of Supply and Demand. They've been trying to do it for the last 4,000 years. https://www.amazon.com/dp/1610161408/

Helium tanks famously represent the Law of Gravity.

Re: Algorithmic rent-pricing litigation expands under new state and local laws

#70

Post by Aurornis »

Nursie wrote: post #45
crooked-v wrote: post #44

Earlier quoted context omitted.

Housing shortages are a result of local policies, and rent control makes housing shortages worse ( https://www.sciencedirect.com/science/article/pii/S105113772... ).

Just as well I’m not arguing for rent control or any particular policy then isn’t it? I’m pointing out that the “it’s my property I can do what I want” attitude needs to be balanced with public needs for housing, because society isn’t purely about optimising the content of your wallet, and extreme deregulation results in slums. (Your linked paper there also says that rent control results in more properties having aff…

> (Your linked paper there also says that rent control results in more properties having affordable rent at the low end of the market, but less overall rental property supply, indicating a reduction at the higher end.

Your conclusion is completely wrong.

What happens when you reduce the higher end of the rental property range? Do you think the people who would have been renting those properties simply vanish? Disappear from the rental market?

No, obviously they don't. So what are they doing instead? They're renting those mid-end properties instead. And what happens to the people who would have rented those mid-end properties that are now occupied by the wealthier renters? They get pushed to the low-end properties. What happens to the people who were trying to get into the low-end properties? They're pushed into being roommates or leaving the city.

Any policy that reduces overall housing supply is a loss for the low end. The way you're bending over backwards to try to imagine this as a good thing indicates something very wrong with your assumptions.

This is a case where someone has become so narrowly focused on hurting the people they perceive as wealthy (people who rent the expensive units) that even solutions that hurt the poor (policies which reduce housing supply) look like a good idea. This isn’t a good way to think.

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