Some really good news from Judd Legum's Popular Information:
Over the last four years, rents have skyrocketed by an average of over 30% nationwide and are a major factor in the overall inflation rate. There are a variety of factors behind the increases, including an overall housing shortage. But the Department of Justice is investigating another potential cause: a massive criminal conspiracy among large landlords.
Last month, the FBI reportedly conducted an unannounced raid of Cortland Management, a major corporate landlord based in Atlanta. The surprise search appears to be part of a Department of Justice criminal investigation, first reported by Politico in March, into an alleged scheme among many corporate landlords to artificially increase rents through collusion.
The investigation centers around the use of RealPage, advanced property management software used by many corporate landlords. Following a 2022 exposé by ProPublica, RealPage and landlords that use the software have been named defendants in multiple class action lawsuits, as well as actions filed by the Attorneys General of Arizona and Washington, DC.
According to the lawsuit filed by the State of Arizona in February, landlords that are supposed to be in competition with each other "outsource daily pricing and ongoing revenue oversight" to RealPage. The company allegedly facilitates and encourages landlords to work cooperatively to increase rents. An e-book produced by RealPage says that the company allows corporate landlords who are “technically competitors” to "work together . . . to make us all more successful in our pricing." RealPage bragged that landlords that use its software “continually outpace the market in good times and bad.” In other words, RealPage helps landlords charge higher rates than they would in a truly competitive market. An executive for Camden Property Trust, a corporate landlord based in Houston, said deploying RealPage's software resulted in "pushing people out" with higher rents but ultimately increased revenue by $10 million.
I wrote about this investigation last year. I am so happy that the Biden administration is going full-out monopoly buster!
Now go donate to ProPublica, whose investigation kicked this off.
