January 8, 2021, Brazil. In this photo illustration the RealPage logo seen displayed on a smartphone
UPDATE: The Department of Justice (DOJ) has just announced a significant settlement with real estate tech firm RealPage, accused of enabling landlords to illegally collude on rent prices. The settlement, revealed in a North Carolina federal court today, aims to combat the rising costs of housing impacting millions of American renters.
Under this agreement, RealPage must cease the use of “nonpublic, competitively sensitive information” from landlords to set rental prices. RealPage’s software will now only utilize data that is at least 12 months old, effectively halting the practice of using active lease data to train its algorithms. This move is expected to restore competitive market conditions and provide relief to cash-strapped renters struggling with soaring rents.
DOJ Antitrust Chief Gail Slater emphasized the importance of the settlement, stating, “Competing companies must make independent pricing decisions.” The DOJ’s decision to settle avoids a lengthy trial while ensuring that algorithmic collusion is addressed.
The lawsuit, originally filed under former US Attorney General Merrick Garland, alleged that RealPage’s technology allowed landlords to prioritize profits over competition, which has exacerbated the housing crisis. It was claimed that landlords were using algorithms to set rents based on confidential data submitted by their competitors, rather than competing for tenants.
RealPage, based in Richardson, Texas, is now required to implement several changes to its practices. This includes not allowing its models to assess geographic market effects below the state level and redesigning features that could limit rent decreases or encourage price alignment among landlords. Additionally, RealPage must stop soliciting sensitive market information through surveys and discussing nonpublic data in revenue management meetings. A court-appointed monitor will oversee compliance with the settlement terms.
The DOJ’s legal action also involved eight states—California, Colorado, Connecticut, Minnesota, North Carolina, Oregon, Tennessee, and Washington—joining as plaintiffs. The suit was expanded in January 2023 to include major landlords such as Greystar Real Estate Partners and Blackstone’s LivCor as co-defendants. While the DOJ has reached settlements with some defendants, legal proceedings against others are still ongoing.
This case marks a critical moment in the fight against algorithmic collusion, an emerging challenge as industries increasingly rely on technology for business operations. The DOJ’s efforts reflect a growing concern about the impact of such practices on competition and consumer prices.
As the settlement awaits court approval, it presents a pivotal opportunity for the housing market to regain its competitive edge. The DOJ will continue to monitor and enforce compliance, ensuring that the settlement leads to meaningful changes that benefit renters across the United States.
RealPage has not yet commented on the settlement. The public, especially renters, eagerly anticipates the implementation of these changes, hoping for a more equitable rental landscape.
