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I think when they take the step of requiring subscribers to let them set prices, they are clearly violating the law. I’m skeptical that analysis reports tellin

I think when they take the step of requiring subscribers to let them set prices, they are clearly violating the law. I’m skeptical that analysis reports telling landlords to raise rent are illegal, but writing in the contract that you have to follow the rules of the association is obvious collusion/cartel behavior.

SoftTalker 2y ago
Yep, on one level it could just be automating the task of scanning Zillow and other sites and seeing what other landlords are asking. Any landlord is going to be doing that to some degree. But the price-fixing amongst "competing" landlords is where it goes wrong.
- phkahler 2y ago
  >> But the price-fixing amongst "competing" landlords is where it goes wrong. I would bet they're spreading the empty units around too, so no landlord ends up with all the empty ones.
  - gruez 2y ago
    Wouldn't that happen organically? The underlying principle of "you want to leave a certain % of your units empty to maximize profits" is microeconomics 101 and doesn't require any coordination between landlords. Without realpage there will probably be a "rule of thumb" to follow, which most landlords will use. They'll in turn set their prices to hit that number, thereby ensuring that the empty units are spread around evenly.
    - mjcl 2y ago
      Correct, and even YieldStar has a customer-set vacancy and lease expiration targets that it works towards. RealPage trains the customers to accept a little more vacancy to gain higher lease pricing.
      - lotsofpulp 2y ago
        Which can be corrected via property taxes that increase at increasing rates for the time period that any given property remains unused, including non residential rentals. Landowners get the biggest subsidy of all in the US, where they pay proportionally very little to the local government’s operational costs, and benefit the most from the law and order, judiciously systems, and education of the local populace. And instead of going after landowners for reaping the rewards of sitting on unproductive uses of land that everyone has to spend extra time and energy to travel around, the government even gives them tax breaks (1031 exchange, property tax caps), and instead goes after people who actually perform work (income tax).
        erik_seaberg 2y ago
        The optimal vacancy rate isn't zero, renters (and relocating homeowners) need to be able to move and to reject bad landlords.
        lotsofpulp 2y ago
        The property tax rate function can easily be formulated such as a continuous power law function such that short periods of vacancy are not penalized.
        RhysU 2y ago
        "Easily" did a lot of work in your reply. What's the right period of vacancy to allow for 1, 2, 3, and 4-bedroom units as a function of floor level, direction faced, time of year, elevator or not, age of building, distance to school and transit, etc?
        lotsofpulp 2y ago
        Why does all of that stuff matter to society? The unit can provide utility as long as it is fit to live in. The only question is what price people are willing to pay for it. We can even generously set it at 1 year just to start things off. If landlords are still too comfortable keeping units empty for the sole purpose of holding out for another price, then it can be revised lower.
    - cyanydeez 2y ago
      Even if they're not colluding, they are acting in a antisocial manner in that they're maximizing profit and not occupancy. If they were a utility, this would resemble selling all your water to las Vegas because they could pay the most and not selling to anyone else even if las vegas' usage drops. Sidelining things to artificially create scarcity is bad for everyone.
mjcl 2y ago
I worked for a company that started using YieldStar back in 2006 and at least back then there was no contractual requirement to use the recommended prices. RealPage did heavily push the idea that you needed to work within YieldStar at all times. If a manager disagreed with a recommended price, our in-house revenue management would work with the manager to see if there is a configuration error in YieldStar (wrong amenities, wrong unit type, wrong target vacancy, etc). If there isn't a configuration error, then the recommended price would usually stand.
credit_guy 2y ago
> I’m skeptical that analysis reports telling landlords to raise rent are illegal, but writing in the contract that you have to follow the rules of the association is obvious collusion/cartel behavior. Very seldom collusion is so blatant to be written in contracts. "Reports" and "recommendations" and "market color" are well established ways for competitors to communicate and coordinate illegally. Without additional evidence it would be difficult to build a case from that only, but large conspiracies leave large traces. The FBI will find something, if the conspiracy existed.
chaosharmonic 2y ago
Not that that doesn't make it worse, but also gathering the pricing data of an entire customer base of landlords and selling them analysis back is, on the face of it, just collusion as a service
berniedurfee 2y ago
It seems like coordinating the supply of available units is the real evil (and maybe illegal) part. Pricing information is public, but inventory is typically not, at least in this context. A cabal deliberately keeping supply down to drive prices up in a particular region seems like the real issue.

SoftTalker 2y ago

Yep, on one level it could just be automating the task of scanning Zillow and other sites and seeing what other landlords are asking. Any landlord is going to be doing that to some degree. But the price-fixing amongst "competing" landlords is where it goes wrong.

phkahler 2y ago
>> But the price-fixing amongst "competing" landlords is where it goes wrong. I would bet they're spreading the empty units around too, so no landlord ends up with all the empty ones.
- gruez 2y ago
  Wouldn't that happen organically? The underlying principle of "you want to leave a certain % of your units empty to maximize profits" is microeconomics 101 and doesn't require any coordination between landlords. Without realpage there will probably be a "rule of thumb" to follow, which most landlords will use. They'll in turn set their prices to hit that number, thereby ensuring that the empty units are spread around evenly.
  - mjcl 2y ago
    Correct, and even YieldStar has a customer-set vacancy and lease expiration targets that it works towards. RealPage trains the customers to accept a little more vacancy to gain higher lease pricing.
    - lotsofpulp 2y ago
      Which can be corrected via property taxes that increase at increasing rates for the time period that any given property remains unused, including non residential rentals. Landowners get the biggest subsidy of all in the US, where they pay proportionally very little to the local government’s operational costs, and benefit the most from the law and order, judiciously systems, and education of the local populace. And instead of going after landowners for reaping the rewards of sitting on unproductive uses of land that everyone has to spend extra time and energy to travel around, the government even gives them tax breaks (1031 exchange, property tax caps), and instead goes after people who actually perform work (income tax).
      - erik_seaberg 2y ago
        The optimal vacancy rate isn't zero, renters (and relocating homeowners) need to be able to move and to reject bad landlords.
        lotsofpulp 2y ago
        The property tax rate function can easily be formulated such as a continuous power law function such that short periods of vacancy are not penalized.
        RhysU 2y ago
        "Easily" did a lot of work in your reply. What's the right period of vacancy to allow for 1, 2, 3, and 4-bedroom units as a function of floor level, direction faced, time of year, elevator or not, age of building, distance to school and transit, etc?
        lotsofpulp 2y ago
        Why does all of that stuff matter to society? The unit can provide utility as long as it is fit to live in. The only question is what price people are willing to pay for it. We can even generously set it at 1 year just to start things off. If landlords are still too comfortable keeping units empty for the sole purpose of holding out for another price, then it can be revised lower.
  - cyanydeez 2y ago
    Even if they're not colluding, they are acting in a antisocial manner in that they're maximizing profit and not occupancy. If they were a utility, this would resemble selling all your water to las Vegas because they could pay the most and not selling to anyone else even if las vegas' usage drops. Sidelining things to artificially create scarcity is bad for everyone.

mjcl 2y ago

I worked for a company that started using YieldStar back in 2006 and at least back then there was no contractual requirement to use the recommended prices. RealPage did heavily push the idea that you needed to work within YieldStar at all times. If a manager disagreed with a recommended price, our in-house revenue management would work with the manager to see if there is a configuration error in YieldStar (wrong amenities, wrong unit type, wrong target vacancy, etc). If there isn't a configuration error, then the recommended price would usually stand.

credit_guy 2y ago

> I’m skeptical that analysis reports telling landlords to raise rent are illegal, but writing in the contract that you have to follow the rules of the association is obvious collusion/cartel behavior. Very seldom collusion is so blatant to be written in contracts. "Reports" and "recommendations" and "market color" are well established ways for competitors to communicate and coordinate illegally. Without additional evidence it would be difficult to build a case from that only, but large conspiracies leave large traces. The FBI will find something, if the conspiracy existed.

chaosharmonic 2y ago

Not that that doesn't make it worse, but also gathering the pricing data of an entire customer base of landlords and selling them analysis back is, on the face of it, just collusion as a service

berniedurfee 2y ago

It seems like coordinating the supply of available units is the real evil (and maybe illegal) part. Pricing information is public, but inventory is typically not, at least in this context. A cabal deliberately keeping supply down to drive prices up in a particular region seems like the real issue.