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Let me guess what's gonna happen. There will be a judgement against RealPage, the US being the only country in the world where commercial law is decided with tr

Let me guess what's gonna happen. There will be a judgement against RealPage, the US being the only country in the world where commercial law is decided with trial by jury virtually guarantees it. Then rents will start rising even more. Landlords will be willing to do price discovery the old fashioned way, offering it with a high rent and letting the unit stay vacant until someone pays it. The cat's out of the bag. Now that people understand how much the market will bear with the present shortage of homes, rents are never going to go down. If RealPage has caused a rise in prices, it's because it showed old assumptions are wrong. Nothing short of mass brainwashing could bring them back. I guess acting against the housing shortage could also solve the issue, but let's be honest, that's never going to happen.

bsder 3y ago
> Then rents will start rising even more. Landlords will be willing to do price discovery the old fashioned way, offering it with a high rent and letting the unit stay vacant until someone pays it. And you fix this with a vacancy tax--which we should have whether this kind of collusion is true or not. Quite often, commercial entities holding apartment complexes are willing to let a property sit vacant because they can tack that onto the end of the financing while accepting lower rent would reset the basis of the financing agreement and force them to cough up cash. A vacancy tax puts the kibosh on this kind of behavior.
- t0suj4 3y ago
  Vacancy tax is insane idea. What is stopping a bunch of crooks scaring away your renters until you sell them a house you intended to hand over to your children?
  - earthling8118 3y ago
    What does this "bunch of crooks" look like while they are scaring people away? Seriously, I want to know a valid scenario where this happens. It sounds more insane to plan around that being the expectation than a vacancy tax.
Varriount 3y ago
At least one of the claims in the suit[0] asserts that it's lower vacancy that lessers want: As a former industry executive explained, the market structure is "a classic prisoners’ dilemma." Since residential real estate is a perishable resource (if a unit sits vacant for a month, a Lessor can never monetize that lost month of rent), Lessors favored a strategy of keeping "heads in the beds," a term for offering sufficiently attractive lease pricing to maximize physical occupancy levels in multifamily residential real estate properties. Thus, that industry executive opined, while all Lessors "would be better off limiting their rent reductions [discounts]," if any Lessor "lower[ed] their rents while the others don’t, then that [Lessor] would outperform" I'm personally doubtful as to how intentional the collision actually is/was, but intentional or not, it would still have negative effects from renters' points of view. EDIT: Nevermind, it's likely intentional: As one Lessor explains, while "we are all technically competitors," RealPage "helps us work together," "to work with a community in pricing strategies, not to work separately." And wow: One Lessor said that the net effect of raising rents and “pushing people out” of the residential real estate leases they could no longer afford, was “10 million in income.” [0] https://www.hausfeld.com/media/550bhzyp/realpage-complaint-filed.pdf https://www.hausfeld.com/media/550bhzyp/realpage-complaint-f...
eptcyka 3y ago
What are you on about? When has price fixing put a downward pressure on the price? With price fixing, it's as though all the landlords in on the fixing are operating as a single business, effectively becoming a monopoly - it's not like potential tenants can pick a cheaper or a more expensive apartment, since the price is roughly the same across all of them anyway - so market forces can't really adjust prices.
- deleted 3y ago
  [deleted]
- csomar 3y ago
  See. This doesn't make economic sense. In a monopoly, there is a single accounting source. That's not the case in a "price fixed market by multiple players". If I have a single house, it might make sense not to rent it to increase the rent price across board for all landlords. But it makes more sense to rent it at a lower price, for the individual landlord, than let it sit empty. Unless the whole market is owned by a few big corporations instead of small landlords who are using their second home as retirement or extra income. Oh wait...
- HDThoreaun 3y ago
  This only works if realpage is causing landlords to leave units vacant. Otherwise the market clearing prices don't change since supply is fixed in the short run. There are accusation of realpage telling landlords to leave units vacant but I'd like to see some better evidence and numbers.
  - eptcyka 3y ago
    I don't disagree that in most cities with any kind of upward economic development there's an inherent market pressure increasing prices - people will want to live in a city and there's a limited supply. However, what realpage is doing is distorting the upward market force, making the increase steeper than it normally would be. One could make the argument that this is just capitalism and applying market forces to human lives is always the moral thing to do. I don't believe it is, I care more about the human outcomes of the systems we use. Ultimately, the underlying problem is the lack of housing supply, which is different from Realpage enabling the collusion between different independent landlords exploiting the shortage in housing supply even further.
n4r9 3y ago
The accusation is that RealPage allows landlords to indirectly coordinate and fix prices across the industry. If this is true, then it is monopolistic price-fixing rather than supply and demand. Ironically, regarding property vacancy, an earlier ProPublica article about RealPage has this to say: > RealPage discourages bargaining with renters and has even recommended that landlords in some cases accept a lower occupancy rate in order to raise rents and make more money. https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent https://www.propublica.org/article/yieldstar-rent-increase-r... EDIT The lawsuit against RealPage has a very clear description of the alleged collusion as well: https://www.hausfeld.com/media/550bhzyp/realpage-complaint-filed.pdf https://www.hausfeld.com/media/550bhzyp/realpage-complaint-f...
- deleted 3y ago
  [deleted]
lamp987 3y ago
"If RealPage has caused a rise in prices, it's because it showed old assumptions are wrong." Your assumption that RealPage (and other software) -powered market is a market is wrong. Its a near monopoly and thus the price is excessive. Everybody has to live somewhere, if you double the rent of (nearly) all flats, everybody will still be willing to pay that doubled price. To simplify it: altough there are many landlords, they arent each others competitors thanks to RealPage. They are collectively one big landlord holding the city hostage.
- HDThoreaun 3y ago
  > if you double the rent of (nearly) all flats, everybody will still be willing to pay that doubled price. This just isn't true. Many people would move in together, many others would go somewhere cheaper. That would lead to vacant units and landlords would have to lower prices to fill them.
  - thelastgallon 3y ago
    Like what happens in bay area. Many people would move in together and rents keep getting lower and lower!

bsder 3y ago

> Then rents will start rising even more. Landlords will be willing to do price discovery the old fashioned way, offering it with a high rent and letting the unit stay vacant until someone pays it. And you fix this with a vacancy tax--which we should have whether this kind of collusion is true or not. Quite often, commercial entities holding apartment complexes are willing to let a property sit vacant because they can tack that onto the end of the financing while accepting lower rent would reset the basis of the financing agreement and force them to cough up cash. A vacancy tax puts the kibosh on this kind of behavior.

t0suj4 3y ago
Vacancy tax is insane idea. What is stopping a bunch of crooks scaring away your renters until you sell them a house you intended to hand over to your children?
- earthling8118 3y ago
  What does this "bunch of crooks" look like while they are scaring people away? Seriously, I want to know a valid scenario where this happens. It sounds more insane to plan around that being the expectation than a vacancy tax.

Varriount 3y ago

At least one of the claims in the suit[0] asserts that it's lower vacancy that lessers want: As a former industry executive explained, the market structure is "a classic prisoners’ dilemma." Since residential real estate is a perishable resource (if a unit sits vacant for a month, a Lessor can never monetize that lost month of rent), Lessors favored a strategy of keeping "heads in the beds," a term for offering sufficiently attractive lease pricing to maximize physical occupancy levels in multifamily residential real estate properties. Thus, that industry executive opined, while all Lessors "would be better off limiting their rent reductions [discounts]," if any Lessor "lower[ed] their rents while the others don’t, then that [Lessor] would outperform" I'm personally doubtful as to how intentional the collision actually is/was, but intentional or not, it would still have negative effects from renters' points of view. EDIT: Nevermind, it's likely intentional: As one Lessor explains, while "we are all technically competitors," RealPage "helps us work together," "to work with a community in pricing strategies, not to work separately." And wow: One Lessor said that the net effect of raising rents and “pushing people out” of the residential real estate leases they could no longer afford, was “10 million in income.” [0] https://www.hausfeld.com/media/550bhzyp/realpage-complaint-filed.pdf https://www.hausfeld.com/media/550bhzyp/realpage-complaint-f...

eptcyka 3y ago

What are you on about? When has price fixing put a downward pressure on the price? With price fixing, it's as though all the landlords in on the fixing are operating as a single business, effectively becoming a monopoly - it's not like potential tenants can pick a cheaper or a more expensive apartment, since the price is roughly the same across all of them anyway - so market forces can't really adjust prices.

deleted 3y ago
[deleted]
csomar 3y ago
See. This doesn't make economic sense. In a monopoly, there is a single accounting source. That's not the case in a "price fixed market by multiple players". If I have a single house, it might make sense not to rent it to increase the rent price across board for all landlords. But it makes more sense to rent it at a lower price, for the individual landlord, than let it sit empty. Unless the whole market is owned by a few big corporations instead of small landlords who are using their second home as retirement or extra income. Oh wait...
HDThoreaun 3y ago
This only works if realpage is causing landlords to leave units vacant. Otherwise the market clearing prices don't change since supply is fixed in the short run. There are accusation of realpage telling landlords to leave units vacant but I'd like to see some better evidence and numbers.
- eptcyka 3y ago
  I don't disagree that in most cities with any kind of upward economic development there's an inherent market pressure increasing prices - people will want to live in a city and there's a limited supply. However, what realpage is doing is distorting the upward market force, making the increase steeper than it normally would be. One could make the argument that this is just capitalism and applying market forces to human lives is always the moral thing to do. I don't believe it is, I care more about the human outcomes of the systems we use. Ultimately, the underlying problem is the lack of housing supply, which is different from Realpage enabling the collusion between different independent landlords exploiting the shortage in housing supply even further.

n4r9 3y ago

The accusation is that RealPage allows landlords to indirectly coordinate and fix prices across the industry. If this is true, then it is monopolistic price-fixing rather than supply and demand. Ironically, regarding property vacancy, an earlier ProPublica article about RealPage has this to say: > RealPage discourages bargaining with renters and has even recommended that landlords in some cases accept a lower occupancy rate in order to raise rents and make more money. https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent https://www.propublica.org/article/yieldstar-rent-increase-r... EDIT The lawsuit against RealPage has a very clear description of the alleged collusion as well: https://www.hausfeld.com/media/550bhzyp/realpage-complaint-filed.pdf https://www.hausfeld.com/media/550bhzyp/realpage-complaint-f...

deleted 3y ago
[deleted]

lamp987 3y ago

"If RealPage has caused a rise in prices, it's because it showed old assumptions are wrong." Your assumption that RealPage (and other software) -powered market is a market is wrong. Its a near monopoly and thus the price is excessive. Everybody has to live somewhere, if you double the rent of (nearly) all flats, everybody will still be willing to pay that doubled price. To simplify it: altough there are many landlords, they arent each others competitors thanks to RealPage. They are collectively one big landlord holding the city hostage.

HDThoreaun 3y ago
> if you double the rent of (nearly) all flats, everybody will still be willing to pay that doubled price. This just isn't true. Many people would move in together, many others would go somewhere cheaper. That would lead to vacant units and landlords would have to lower prices to fill them.
- thelastgallon 3y ago
  Like what happens in bay area. Many people would move in together and rents keep getting lower and lower!