Seattle will soon ban the controversial rent-setting platform RealPage and similar services, becoming the latest local government to take aim at a technology that critics say helps drive up housing costs.
The Seattle City Council voted unanimously Tuesday to ban a widely used class of software that gathers information from an array of properties and uses that data to recommend rental prices to landlords. The most notable company providing that type of software, RealPage, is under legal fire nationwide after allegations that its products allow landlords to collude and charge higher prices.
Given “the fact that rent really is too darn high,” the ban is “one small way that we can contribute to making this a more diverse and equitable city,” said Councilmember Cathy Moore, who sponsored the bill. Moore plans to resign from the council in July, citing health and personal reasons, and has faced criticism from some progressives for her support of potential rollbacks to city tenant protections.
The council approved the legislation 7-0, with Councilmember Dan Strauss absent and Councilmember Maritza Rivera abstaining because she is a landlord.
The new law bans any service that compiles rent prices, occupancy rates and other data from private or public sources and then uses an algorithm to recommend rent prices to more than one landlord. The law would also bar Seattle landlords from subscribing to or contracting with those services, and would allow the City Attorney’s Office or tenants to seek $7,500 per violation. The rule exempts basic record-keeping programs, software related to short-term rentals and hotels, and programs that are based only on public information and are available without a contract.
The proposal clearly takes aim at RealPage, a program where landlords share information about their properties and, via an algorithm, receive recommendations for rent levels. While some of the information RealPage relies on can be accessed by browsing public apartment listings, the platform also taps into details landlords would otherwise keep private. Together, public and private data inform the recommendations, and skeptics say the use of private data amounts to collusion among competing landlords.
Tenants, state attorneys general and the Justice Department have sued RealPage in recent years, alleging antitrust violations. The Washington attorney general’s office said in a lawsuit this year that RealPage and the landlords who use it “manipulate, distort, and subvert competitive forces.”
RealPage opposed Seattle’s ban and has sued Berkeley, Calif., over a similar law. The company disputes allegations that its software hurts competition, noting that landlords often don’t accept its price recommendations.
Seattle’s legislation “is essentially a total ban on algorithmic pricing,” RealPage Vice President Mike Semko told council members Tuesday.
“There is not an industry in the United States that does not use software to help sellers price widgets. The apartment industry is no different,” Semko said. “This would put apartment owners way behind the eight ball.”
But renter advocates say the city should act to rein in landlords.
“It really is no secret that renters are struggling in Seattle and it’s not accidental,” said Lydia Felty, a renter and co-chair of the Seattle Renters’ Commission, who was speaking on her own behalf. “Landlords in Seattle are colluding through RealPage and other rent-fixing sites to drive up rents without regard for impacts on the city.”
The legislation directs the city’s construction and inspections department to educate landlords about the new rule and update the council on those efforts next year.
The bill now goes to Mayor Bruce Harrell, who plans to sign it, a spokesperson said. The new law will take effect a month after his signature.
