The US government has sued a major software company, RealPage, accusing it of worsening the country’s housing crisis by helping landlords raise rents.
According to BBC, the Department of Justice (DOJ) claims that RealPage’s software lets landlords share private information, allowing them to work together illegally to increase rents.
Attorney General Merrick Garland pointed out that everyone knows rents are too high, and he believes this software is part of the problem.
RealPage, a Texas-based company owned by Thoma Bravo, didn’t immediately respond but has previously denied similar accusations.
BBC reports that RealPage has been in the spotlight after an investigation by ProPublica and has already faced lawsuits from renters and prosecutors earlier this year.
With housing affordability being a big issue in the US, BBC notes that Vice President Kamala Harris has also criticized rent-setting algorithms in her campaign speeches.
The DOJ, along with eight states, claims RealPage had access to data on millions of apartments and that its software allowed landlords to manipulate the market.
BBC highlights that the lawsuit is significant because it’s the first time the federal government is tackling the growing use of pricing algorithms.
RealPage argues that landlords, not the software, set rent prices and that its influence is overstated. However, the DOJ claims that RealPage controls about 80% of the market for rent management software, according to BBC.
The government is also investigating similar practices in other industries, like meat pricing.
BBC reports that officials warn that modern businesses can’t hide behind technology to break the law.
https://www.bbc.com/news/articles/c4gqw080n4jo