With Shared Software, Landlords Are Teaming Up to Raise Rents
San Francisco has banned RealPage, a software company that computer-generates recommended rents for landlord clients in what some are calling a price-fixing scheme. It’s a step toward curbing rent-raising collusion between landlords.
over thirty-one thousand landlord clients managing over 19.7 million rental units
In case anyone is still wondering why housing is fucked, this is it right here. That's an average of over 600 rental units per landlord.
People renting out their old house for a small profit are not the issue. Like a lot of things, it really only breaks once corporations get involved.
Yep and it just compounds. The money they make they buy more houses driving prices up so they make more.
Although, like economic figures, this tends to be concentrated. It would not surprise me if a hundred of those clients were managing 20k or more units apiece.
I have a real problem with landlords. It feels like an especially predatory business. Some things just shouldn't be for profit. I mean, when you own something that people universally need, and charge as much as you possibly can for it, to maximize your own profit, for nothing other than just being the owner, it feels really scummy.
I think there's a little room for nuance, but not much. The way corporate landlords are buying up houses and collaborating to fix prices is totally fucked and needs regulated. There also needs to be regulation or limits for private property owners who buy up a bunch of properties and slumlord it.
Where I think there's nuance is how things fall right now. I just left the military and I'm renting out my house exclusively to military occupants who are not trying to buy. I bought it at 3% interest and my mortgage is more or less fixed. The next buyer was looking for it as an addition to their rental portfolio. I did the math before deciding to rent and found that because my interest and mortgage are so low I can charge $800/month less in rent than a mortgage would be if I sold it. It's also less than their housing allowance so they have more for utilities and food.
It's regrettable that this is the situation, but in this specific case in a very high demand/low supply area, renting it out is the lesser of the evils. Hopefully the market crashes or rates fall and I can sell it to a family who needs it. But until then, I'll try to make things easier on some service members.
It's admirable that you are trying to help some service men and women, and not merely looking to make the highest possible profit for yourself. I'm sure you're not the only landlord who isn't motivated primarily by greed, but many, if not most, are, because they are incentivized to be.
When the goal is maximum profits, it incentivizes business owners of all types to generate as much revenue as possible (and in the case of housing, that means increase rents as much as possible) and cut costs as much as possible. That's why many people are paying more and more for lower and lower quality housing.
The problem is the profit motive. And we can't just hope that all landlords will decide to be more like you, not when they have every incentive to be as greedy as possible.
I own my home. I may rent it out when I retire because I sure as fuck won't have any money. Maybe we'll get an RV or move to the Philippines. Dunno. But I need to get paid on that home.
For one, renters are likely to fuck shit up, because it's not theirs, they have no stake in the property. They may simply be ignorant and ignore problems that cost $100 to fix today, $1,000 to fix tomorrow. Also, I need to buy extra liability insurance.
Then there's routine stuff. When my ex and I bought the place we took payday loans for 2-months just to get the tools and stuff we needed to care for the place. And nearly everything we bought was used. Paid them off responsibly and quickly, but it was costly.
Ever priced a new roof? Hell, within the last 30-days our sink stopped up, the washer died, fridge finally died. and that's only the big stuff. Even buying off FB, that was $1,000 in new appliances and repairs. Oh, and the hot water heater leaks, but that's under control for the moment. And the roof needs patched. I'm scared to even price that, can't afford it ATM anyway.
So yeah, I need serious "profit" just to break even.
EDIT: Do you idiots think I'm currently renting this home? FFS, try reading from the beginning.
So yeah, I need serious "profit" just to break even.
That's a contradiction in terms. To break even is by definition not a profit. To make a profit, you need a surplus after you minus expenses from revenue. If landlords were content to just break even, I wouldn't necessarily have a problem with them. In fact, I think not-for-profit housing could go a long way in addressing the housing affordability crisis.
"Predatory Cabal"
"Price Fixing"
Landlords are literally rent-seeking, they provide no real economic value to society.
At best they are opportunistic parasites.
And now they're part of a cartel, which is not only illegal in the US, but illegal in international law. (The oil crisis of the late 1970s was thanks to OPEC price fixing. We're still sore about it.)
"As soon as the land of any country has all become private property, the landlords love to reap where they never sowed, and demand a rent even for its natural produce."
-Adam Smith
People that developed or came up with the idea for that software:
Y'know, I think kneecaps are no longer scary enough. I think it's time we moved on to elbows.
Half of the bones in the human body are in the hands and the feet.
Telling someone you’re going to break every bone in their body feels like an exaggeration. It’s not realistic, and takes more effort than it’s worth. But it’s actually fairly easy for a small group of 3 or 4 attackers to break half the bones in a person’s body, with just a sledgehammer that you can buy in any hardware store.
Just some food for thought…
I know that something like this won't accomplish much, but like gun control, I'm a huge fan of making it terribly inconvenient to do the wrong thing.
It's a shame that even in a place like San Francisco, it's apparently impossible to enact rent control.
It’s a shame that even in a place like San Francisco, it’s apparently impossible to enact rent control.
It wasn't until very recently that SF became synonymous with progressive politics like it is today. For most of the 20th century, it was a highly conservative, "rich people," city. That kind of embedded wealth doesn't just go away within a few decades, SF is still pretty conservative at its core.
I didn't know. Thanks for sharing.
I'm not suggesting these people deserve to be executed.
Simply stating a fact.
It was never about supply and demand.
It really wasn't. As soon as dynamic pricing hit, I stopped believing in the bullshit lie of supply and demand.
Capitalism is a cancer on society.
Why are renters not teaming up? I am sorry but the membership in my local tenants union is frankly shameful. Unite, organise in solidarity is the only way. I know people have a limited time but that's the situation we are in.
You know I've honestly never thought of a renter's union before and that's a pretty great idea.
I honestly didn't even know that was a thing
Because unions are evil. They eat babies and practice dark satanic communist rituals. My GOP certified preacher said so!
price collusion is free speech, just ask the petrol stations
That's not how that works. They aren't working together so when they look out the window and see the price they match or go lower. When the rental corporations are working together they agree on higher prices.
Gas stations actually make very little profit on the gas itself. It's the attached mini mart that brings in the cash.
They aren't working together so when they look out the window and see the price they match or go lower.
The stories my wife tells me about her gas station job say this is wrong. Her boss has binoculars readily available so they can see if the station across the street changes their prices, and they'd follow suit.
There are more recent news updates than this one, but this is what I could find quickly before I have to head out.
https://www.politico.com/news/2024/07/12/justice-department-rental-market-collusion-lawsuit-00167838
According to the legal system, someone caught selling an ounce of weed is infinitely more dangerous and harmful than this behavior. These people should have the death penalty.
I think we should simply take their money, no need to execute them, it would be way too nice to let them off the hook of life, take all their money, have them pay fines and live in poverty until they die from natural causes.
If there aren't laws for crimes against the economy, there should be.
My MIL worked for RealPage for six months. My wife (before we met) ended up in the hospital, and it was pretty touch-and-go for a while. MIL obviously wanted to go spend time with her. Her manager told her to choose between her job or her daughter. Because if she took time off to go to the hospital, the manager would consider it a resignation. MIL told the manager to go fuck himself, and walked out.
And from everything I’ve seen, that was just par for the course for RealPage. It‘a an evil company, run by evil people, with an evil end goal.