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RealPage is Cartel As A Servics (CAAS), by allowing landlords to collude through a 3rd party to raise rents.

vkou 4y ago
How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? Is there some core part of US land policy that only works if landlords behave like low-information market participants? If these landlords were colluding with eachother to punish defectors that undercut them, that would be a cartel. If they are all reacting to a shortage by raising their prices, that just makes them... Market agents.
- alistairSH 4y ago
  Unless I’m missing something, it isn’t any different, other than it makes the market more efficient (in that the price gets set “correctly” earlier - by the manual method, a landlord likely over-prices initially and waits for a tenant OR underprices initially and loses that income). It’s just in a broken market - there isn’t enough supply of housing, so prices are going up. And because everybody needs housing, it feels icky to many people (I’m one of them, but my solution would be relax zoning and allow more housing). Unless using this system requires participants to set a price, I’m not sure it meets the definition of price fixing. A landlord can still underprice to guarantee a tenant quickly. Or overprice in the hopes they catch a low-info, high-income tenant.
- ceejayoz 4y ago
  > How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? OPEC works because they all move together. One of them raising or lowering production alone doesn't do much; all of them doing it at similar times does. Same with RealPage. By having nearly everyone use it, nearly everyone's pricing moves in a coordinated fashion, and they collectively reduce the chances of downward price pressure.
- ryan_lane 4y ago
  > How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? Landlords don't always advertise, and they also negotiate rents. Knowing the actual market price isn't easy (and sometimes not possible), because that information isn't publicly available and certainly isn't real-time. RealPage is getting private market information from landlords, and using it to coordinate rent prices, including coordinating actions to remove supply from the market to artificially increase prices. This removes competition from an otherwise competitive market. This is collusion via a middleman.

vkou 4y ago

How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? Is there some core part of US land policy that only works if landlords behave like low-information market participants? If these landlords were colluding with eachother to punish defectors that undercut them, that would be a cartel. If they are all reacting to a shortage by raising their prices, that just makes them... Market agents.

alistairSH 4y ago
Unless I’m missing something, it isn’t any different, other than it makes the market more efficient (in that the price gets set “correctly” earlier - by the manual method, a landlord likely over-prices initially and waits for a tenant OR underprices initially and loses that income). It’s just in a broken market - there isn’t enough supply of housing, so prices are going up. And because everybody needs housing, it feels icky to many people (I’m one of them, but my solution would be relax zoning and allow more housing). Unless using this system requires participants to set a price, I’m not sure it meets the definition of price fixing. A landlord can still underprice to guarantee a tenant quickly. Or overprice in the hopes they catch a low-info, high-income tenant.
ceejayoz 4y ago
> How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? OPEC works because they all move together. One of them raising or lowering production alone doesn't do much; all of them doing it at similar times does. Same with RealPage. By having nearly everyone use it, nearly everyone's pricing moves in a coordinated fashion, and they collectively reduce the chances of downward price pressure.
ryan_lane 4y ago
> How is it different from just eyeballing market price from looking at similar units, and renting yours out for +10-15% more? Landlords don't always advertise, and they also negotiate rents. Knowing the actual market price isn't easy (and sometimes not possible), because that information isn't publicly available and certainly isn't real-time. RealPage is getting private market information from landlords, and using it to coordinate rent prices, including coordinating actions to remove supply from the market to artificially increase prices. This removes competition from an otherwise competitive market. This is collusion via a middleman.