4 ms·

AFAICT there isn't anything preventing landlords from setting pricing lower than what RealPage recommends. That is just Propublica's weasily framing. In reality

by Aunche 2y ago

AFAICT there isn't anything preventing landlords from setting pricing lower than what RealPage recommends. That is just Propublica's weasily framing. In reality, it sounds like they're saying, if you want to get the results from our recommendations, you actually need to follow our recommendations.

narism 2y ago
Realpage put many roadblocks in the way of customers using prices not provided by the system. A couple: Rent overrides required written business justifications, would often trigger follow ups to the agent attempting the override and then their management to dissuade them, and eventually might be refused in the end. Realpage monitored compliance of customers using their provided prices and those who didn’t meet a certain level would be kicked off the platform. Pages 17-22 here: https://oag.dc.gov/sites/default/files/2023-11/DC%20OAG%20RealPage%20Complaint%20-%20Filed.pdf https://oag.dc.gov/sites/default/files/2023-11/DC%20OAG%20Re...
- Aunche 2y ago
  Thank you for finding the relevant allegations. They certainly do sound more damning, though that's to be excepted if you take the prosecution at face value. This part jumps out: > the landlord’s regional manager Why would the owner of a property have a regional manager? That makes it sound like they're deliberately conflating local property managers with actual landlords. I suppose if the actual landlords are passive REIT investors, then there's still a possibility of actual collusion.
whimsicalism 2y ago
Even that runs afoul of the law :)
ecosystem 2y ago
The profitability of cartel price fixing in a slow, supply constrained market is enough carrot to cause to lead to anticompetitive coordination. In this game theory setup, breaking from the cartel only pays off with excess supply (long vacancies, new units you could lease), which is fairly atypical especially bc of regulatory hurdles. If the market is supply constrained, being part of a cartel maximizes profits. Over longer periods, a competitor could increase supply and inject some dynamism that rewards breaking from the cartel, but for urban/suburban apartment complexes, this is long time and of limited effect to the cartel's pricing power. This is why the FTC exists to prevent this type of illegal coordination (bc it's so attractive to profits!) Edit: typo

by Aunche 2y ago

narism 2y ago

Realpage put many roadblocks in the way of customers using prices not provided by the system. A couple: Rent overrides required written business justifications, would often trigger follow ups to the agent attempting the override and then their management to dissuade them, and eventually might be refused in the end. Realpage monitored compliance of customers using their provided prices and those who didn’t meet a certain level would be kicked off the platform. Pages 17-22 here: https://oag.dc.gov/sites/default/files/2023-11/DC%20OAG%20RealPage%20Complaint%20-%20Filed.pdf https://oag.dc.gov/sites/default/files/2023-11/DC%20OAG%20Re...

Aunche 2y ago
Thank you for finding the relevant allegations. They certainly do sound more damning, though that's to be excepted if you take the prosecution at face value. This part jumps out: > the landlord’s regional manager Why would the owner of a property have a regional manager? That makes it sound like they're deliberately conflating local property managers with actual landlords. I suppose if the actual landlords are passive REIT investors, then there's still a possibility of actual collusion.

whimsicalism 2y ago

Even that runs afoul of the law :)

ecosystem 2y ago

The profitability of cartel price fixing in a slow, supply constrained market is enough carrot to cause to lead to anticompetitive coordination. In this game theory setup, breaking from the cartel only pays off with excess supply (long vacancies, new units you could lease), which is fairly atypical especially bc of regulatory hurdles. If the market is supply constrained, being part of a cartel maximizes profits. Over longer periods, a competitor could increase supply and inject some dynamism that rewards breaking from the cartel, but for urban/suburban apartment complexes, this is long time and of limited effect to the cartel's pricing power. This is why the FTC exists to prevent this type of illegal coordination (bc it's so attractive to profits!) Edit: typo