4 ms·

Honestly the strongest argument I've heard that these algorithms are anticompetitive is "The DoJ thinks they are". So maybe there's some non-public information

Honestly the strongest argument I've heard that these algorithms are anticompetitive is "The DoJ thinks they are". So maybe there's some non-public information of anticompetitive behavior. We don't know how many housing units use Realpage pricing algorithms in 2024, but in 2017 when Realpage bought the tech, it was being used in 1.5 million rentals (https://www.realpage.com/news/realpage-to-acquire-lease-rent-options/ https://www.realpage.com/news/realpage-to-acquire-lease-rent...) and there were 43 million rentals in the US, which means nationally they had less than 4% marketshare. Obviously, cartel behavior (raising prices above market) does not work if you have 4% of the market. Perhaps their sales have gone up 20X in 7 years and they have enough market power for cartel behavior (doubtful)? Perhaps they have a low marketshare nationally, but they have a high marketshare in a few specific markets? Maybe, lets see what the DoJ says.

brandonfro 2y ago
From the press release: "The complaint separately alleges that RealPage has unlawfully maintained its monopoly over commercial revenue management software for multi-family dwellings in the United States, in which RealPage commands approximately 80% market share."
- andrewmutz 2y ago
  That’s 80% of companies who are using revenue management software are using Realpage, not that 80% of rental units are using Realpage revenue management software
  - sleepybrett 2y ago
    ... yeah that's pretty much all of them minus some mom and pops who manage themselves. And from personal experience those mom and pops are selling out to management companies now so a whole neighborhood of single family rentals might be actually controlled by just one or two companies.
- refurb 2y ago
  That’s seems like an odd anti-competitive complaint considering the customer has the option to not use such software at all? It’s like complaining about a monopoly on lawn mowing. Owners can always choose to mow their own lawns if they don’t like the cost of hiring it out.
sleepybrett 2y ago
The doj doesn't lose cases like these, and doesn't bring cases that are absolute slam dunks.
- tqi 2y ago
  "The Department of Justice (DOJ) Antitrust Division — for the third time in the span of a year — recently failed to convince a jury that alleged agreements to fix or stabilize labor markets should be punished criminally." https://www.skadden.com/insights/publications/2023/04/quarterly-insights/are-the-ftc-and-doj-losing-antitrust-battles https://www.skadden.com/insights/publications/2023/04/quarte...
LUmBULtERA 2y ago
>Perhaps they have a low marketshare nationally, but they have a high marketshare in a few specific markets? Maybe, lets see what the DoJ says. I think it's very much this. National market share is meaningless. I live in Northern Virginia -- some SFH that rents in another market is meaningless for someone looking for an apartment here. In this area, it seems very much that all large multi-unit apartment buildings use RealPage. Individually owned condos that are rented out exist, but of course their quantity is very tiny compared to the number of apartment towers/complexes. SFHs, likewise, are poor substitutes, because someone in the price range of a studio, 1 or 2 bedroom unit isn't going to rent a SFH and splitting a SFH brings problems of its own.
bryan2 2y ago
If this source is correct it’s 7/10 in PHX https://www.thebignewsletter.com/p/antitrust-enforcers-the-rent-is-too https://www.thebignewsletter.com/p/antitrust-enforcers-the-r... They’re also super glib about it online https://www.realpage.com/analytics/phoenix-apartment-rent-growth-surges/ https://www.realpage.com/analytics/phoenix-apartment-rent-gr... IMHO automated price raising should be considered problematic or at least suspicious.

brandonfro 2y ago

From the press release: "The complaint separately alleges that RealPage has unlawfully maintained its monopoly over commercial revenue management software for multi-family dwellings in the United States, in which RealPage commands approximately 80% market share."

andrewmutz 2y ago
That’s 80% of companies who are using revenue management software are using Realpage, not that 80% of rental units are using Realpage revenue management software
- sleepybrett 2y ago
  ... yeah that's pretty much all of them minus some mom and pops who manage themselves. And from personal experience those mom and pops are selling out to management companies now so a whole neighborhood of single family rentals might be actually controlled by just one or two companies.
refurb 2y ago
That’s seems like an odd anti-competitive complaint considering the customer has the option to not use such software at all? It’s like complaining about a monopoly on lawn mowing. Owners can always choose to mow their own lawns if they don’t like the cost of hiring it out.

sleepybrett 2y ago

The doj doesn't lose cases like these, and doesn't bring cases that are absolute slam dunks.

tqi 2y ago
"The Department of Justice (DOJ) Antitrust Division — for the third time in the span of a year — recently failed to convince a jury that alleged agreements to fix or stabilize labor markets should be punished criminally." https://www.skadden.com/insights/publications/2023/04/quarterly-insights/are-the-ftc-and-doj-losing-antitrust-battles https://www.skadden.com/insights/publications/2023/04/quarte...

LUmBULtERA 2y ago

>Perhaps they have a low marketshare nationally, but they have a high marketshare in a few specific markets? Maybe, lets see what the DoJ says. I think it's very much this. National market share is meaningless. I live in Northern Virginia -- some SFH that rents in another market is meaningless for someone looking for an apartment here. In this area, it seems very much that all large multi-unit apartment buildings use RealPage. Individually owned condos that are rented out exist, but of course their quantity is very tiny compared to the number of apartment towers/complexes. SFHs, likewise, are poor substitutes, because someone in the price range of a studio, 1 or 2 bedroom unit isn't going to rent a SFH and splitting a SFH brings problems of its own.

bryan2 2y ago

If this source is correct it’s 7/10 in PHX https://www.thebignewsletter.com/p/antitrust-enforcers-the-rent-is-too https://www.thebignewsletter.com/p/antitrust-enforcers-the-r... They’re also super glib about it online https://www.realpage.com/analytics/phoenix-apartment-rent-growth-surges/ https://www.realpage.com/analytics/phoenix-apartment-rent-gr... IMHO automated price raising should be considered problematic or at least suspicious.