At this year’s Anti-Monopoly Summit, Johnathan Kanter, Assistant U.S. Attorney General for the Antitrust Division, made it clear that the department would be focusing its attention on anticompetitive behavior in the rental housing industry.
“We filed several statements of interest relating to algorithmic collusion and rental housing, to underscore that anti-competitive collusion is illegal, whether it happens in a smoke-filled room or a data center.”
Recent moves suggest this trend will continue, as news outlets are reporting that the Department of Justice (DOJ) is gearing up to file a significant lawsuit against real estate software company RealPage Inc. over allegations of anticompetitive behavior.
The anticipated legal action centers on allegations that RealPage facilitated collusion among major landlords, driving up rental prices and distorting the rental market. This lawsuit is part of the Biden administration’s broader initiative to tackle corporate practices that harm consumers, particularly in the housing sector.
The DOJ’s investigation, which has been underway for several months, focuses on whether RealPage’s software enabled landlords to coordinate rent increases, effectively reducing competition in the rental market. According to sources familiar with the investigation, the software’s pricing recommendations allowed landlords to push rents higher than they might have if operating independently, thus harming tenants who faced inflated rental costs.
The DOJ will likely argue that the company’s software created an environment where landlords could effectively operate as a cartel, setting prices in concert rather than competing against each other, as other lawsuits against the tech company have done.
“RealPage and the defendant landlords illegally colluded to artificially raise rents by participating in a centralized, anticompetitive scheme, causing District residents to pay millions of dollars above fair market prices,” wrote Washington DC Attorney General Brian L. Schwalb in a complaint from 2023. “Defendants’ coordinated and anticompetitive conduct amounts to a District-wide housing cartel.”
The DOJ’s scrutiny intensified following complaints from tenant advocacy groups and a series of investigative reports highlighting how RealPage’s software influenced rent prices in various markets. Critics argue that the company’s technology has contributed to the rising cost of living, particularly in urban areas where housing affordability is already a significant issue.
The lawsuit against RealPage also underscores the growing concerns about housing affordability in the United States. As rents continue to rise, particularly in metropolitan areas, policymakers and regulators are under pressure to find solutions that protect tenants and ensure fair competition in the housing market.
WBE is actively involved in litigation against anticompetitive practices in the rental housing market. To learn more about this case, click here.
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