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DOJ sues realpage for algorithmic pricing scheme that harms renters

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

#221

Post by gen220 »

bluGill wrote: post #168
legitster wrote: post #145

Earlier quoted context omitted.

Competition clearly isn't working for housing. Because it's not a competitive market. I am just skeptical to the extent it is due to pricing cartels.

It is a competitive market. However supply is often supply constrained (both by bad zoning and that some places are just better than others). The cartels only work because supply is constrained enough that they have power, if supply was less constrained the cartel could not raise prices as much (when supply is constrained you need less members in the first place). I support looser zoning rules as reducing supply cons…

If we loosen zoning, and a half-dozen skyrises go up that are owned by a ~cartel~ group of friendly property developers, with X% of housing required to go to low-to-middle income households with a govt-required vacancy rate on that segment, do you think that would make rental prices go down?

Because we've run this experiment in Downtown Brooklyn for the last ten years, and rent has only gone very significantly up.

I think, at some point, you have to begin asking questions of the concept of nonresident landlordism and privately-owned massively-multifamily housing, rather than zoning, when changes to zoning don't actually make a difference to residents.

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

#222

Post by HDThoreaun »

RhodesianHunter wrote: post #114
legitster wrote: post #56

Earlier quoted context omitted.

This gets into prisoner's dilemma though. If everyone but me is using the price fixing app, I have a strong incentive to undercut them, even by just a few dollars. So without a cartel-like enforcement mechanism, there is no reason it wouldn't just fall apart naturally in the long run. In the complaint there was a mention of "compliance" which could get into that piece though.

>I have a strong incentive to undercut them Not in a supply constrained market where your rental will be occupied either way.

If all units are being rented there is no collusion as the market clearing price is being charged. Collusion requires taking supply off the market in order to raise prices.

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

#223

Post by HDThoreaun »

bick_nyers wrote: post #60
Manuel_D wrote: post #24

Earlier quoted context omitted.

Lots of people want to blame rising prices on price fixing, when there really is growing demand without commensurate increases of supply. They want a silver bullet to bring down prices, without tackling the underlying problems. > That being said, I price my rental properties against what similar square footage gets at nearby apartments... Sooo if they are going up my rent is going up as well, and I bet most landlords…

I agree that the underlying issue is a lack of supply. However, if a landlord is commanding a 30% profit margin on a non-luxury apartment then I think they are contributing to the problem (to be clear, I'm not insinuating anyone in this thread is doing this). I think the only objective way to tell if it's priced too high is by the profit margin, but of course even that can be inflated if e.g. a developer took a huge…

Business arent charities. Almost every one is trying to maximize profits.

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

#224

Post by HDThoreaun »

consteval wrote: post #200
bluGill wrote: post #184

Earlier quoted context omitted.

Landlord is about luck of the tenants. A bad tenant will destroy your property costing you a lot of money. A bad tenant will not pay thus forcing you to have your property earning nothing for months until you can legally evict them. If you don't have enough tenants you lose money because you still have to pay your costs (the bank for your loan, maintenance...). You can make a lot of money but it isn't easy money. (pa…

Easy, you outsource your tenant management to a company that does that sort of thing. There's many highly reliable methods to get good tenants. Outsourcing to a company that specializes in that works because you're already making free money by being a landlord, so now you just make less free money.

Then you wont make any money

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

#225

Post by SmartJerry »

consteval wrote: post #156
game_the0ry wrote: post #10

Earlier quoted context omitted.

I wouldn't be happy either if I was a landlord. But the landlord-ing business is a tough business, and business is about to get tougher.

I think being a landlord is pretty much the easiest business ever. As compared to real businesses, who really produce products and really participate in competitive markets.

How long have you been a landlord? If it's so easy, everyone would do it.

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

#226

Post by Manuel_D »

Alupis wrote: post #195
tacticalturtle wrote: post #179

Earlier quoted context omitted.

It’s a problem when every town/municipality thinks like this, and then larger state- wide governments are faced with the dilemma of an angry voting population tired of high housing costs. You can either get ahead of a state-wide solution and implement something where you have some control that works for your community, or you can do nothing and wait for the state government to begin to remove zoning from local contro…

High rent costs are not something a town/municipality can solve. In a most ways, it's also something a state government cannot solve. "High" rent is relative to the area, and rent is high across the entire country currently. Lack of rental housing drives up rental prices. The lack of rental housing is largely due to unnaturally low interest rates. People qualified for oversized loans, and bought up the rental supply,…

No, rent is not high across the entire country. It's high in a select few metros, and fairly low everywhere else. Municipalities can't unilaterally reduce rents, but the can exacerbate the problem by disincentivizing housing through regulation and price controls.

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

#227

Post by chgs »

trilobyte wrote: post #181
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…

So you would be ok with contractors who are building the houses (often as subcontractors) coordinating their prices for the work to maximize the cost to the developer?

Sounds like a union

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

#228

Post by chgs »

switch007 wrote: post #197
Alupis wrote: post #123

Earlier quoted context omitted.

Wikipedia indicates most of these Council Homes were built in the early 1900's - and are not modern construction. An additional average of a around 100 homes total were built per year from the 40's through 1980. So these don't appear to be helping a significant portion of the population. Wikipedia also indicates in the 1970's the UK government dramatically and suddenly cut back on funding for these homes (among other…

I note you don't link to your sources. You need better sources and/or better research skills. 100 per year is way off. Have you confused 100 with 100,000? I think even that is low Yes the Conservatives stopped building council homes, mostly through neoliberal ideology that the government shouldn't provide housing. The private market houses are far worse quality

The number of new council house starts dropped in the 70s, before thatcher.

The trend continued into the 80s but blaming thatcher and neoliberalism is simplistic at best.

https://www.ons.gov.uk/peoplepopulationandcommunity/housing/...

Table 2A, housing starts by FY.

1970 185k. 110k in 1978/79 before thatcher’s landslide. By 1980 (so before the 1980 housing act came in) down to 58k.

The starts are what’s important as those are the ones impacted by new legislation and policy.

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

#229

Post by hnburnsy »

kpw94 wrote: post #65
jasode wrote: post #19

>Armed with competing landlords’ data, RealPage also encourages loyalty to the algorithm’s recommendations through, among other measures, “auto accept” functionality and pricing advisors who monitor landlords’ compliance. I think the "private prices" + "autoaccept" + "compliance" is the key misbehavior that gets RealPage into legal trouble. If competitors want to converge on prices in a legal manner , they have to do…

Many listings for apartments are on on-site.com (which is "a RealPage company") and are publicly available... So it could be argued it's not "private prices" + "autoaccept" + "compliance" But rather "public prices" + "autoaccept" + "compliance" Still problematic behavior (and probably add "private knowledge of inventory forecast" on top of that), but I'd argue price signaling of the available inventory isn't the main…

>are publicly available

The list price is different than the final accepted monthly rate\term for the renter. Realpage is getting the actual rental information.

In addition, the occupancy of the building is also not public data.

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