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The lawsuits also argue that RealPage pressures landlords to comply with its pricing suggestions—something that would make no sense if the company were merely being paid to offer individualized advice. In an interview with ProPublica, Jeffrey Roper, who helped develop one of RealPage’s main software tools, acknowledged that one of the greatest threats to a landlord’s profits is when nearby properties set prices too low. “If you have idiots undervaluing, it costs the whole system,” he said. RealPage thus makes it hard for customers to override its recommendations, according to the lawsuits, allegedly even requiring a written justification and explicit approval from RealPage staff. Former employees have said that failure to comply with the company’s recommendations could result in clients being kicked off the service
Holy shit that’s blatantly cartel pricing.
Yeah…
Headline talks about AI, article talks about algorithms. Chasing that click bait I see.
🤓
A simpler time…
Of course, algorithms! The answer was right there all along!
You can’t make algorithms without AI ;)
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You know AI is an algorithm?
It’s probably ML.
True but every article about “AI” is really talking about something else.
In this case they’re talking about “Algorithm Implementation”
a lot of AI is really just fancy statistics stuff. Years and years ago, I was doing an introductory lesson on some AI tools and the example given was predicting the price of rent or the price of a house. There’s likely a mixture of the statistics part to predict and the algorithmic part to increase the amount and see if people bite.
It turns out, most will when everyone is using it bc being homeless kinda sucks.
Competition is supposed to help lower prices. If one tennis racket manufacturer overcharges, then another can charge less and steal all their sales.
But if landlord #1 owns an house and overcharges while landlord #2 owns a house and does not, it’s not like landlord #2 gets all the tenants. They still just have one house. There is no way for one of them to win by benefitting tenants. They can however both win by both hurting tenants.
I guess where there is too much housing, one apartment building can keep full occupancy by charging less, while another building across the street might have 60% occupancy because they overcharge. But rarely is there too much supply anymore. And rarely are there such head-to-head commoditized situations.
There’s a lot one side of the market can do with collusion to drive up prices.
For example, the housing supply available on the market right now often fluctuates over time - once someone has a long term tenancy, their price is locked in until the next legal opportunity to change the price. If there is a low season - fewer people living in an area, higher vacancy rate - in a competitive market, tenants often want a long term contract (if they are planning on staying), and the landlord who can offer that will win the contract. The landlord gets income during the low period, but forgo a higher rent they might get during a high period. Another landlord who tries to take a hardline policy of insisting tenants renew their contract during the high period would lose out - they would just miss out on rent entirely during the low period, likely making less than the other landlord.
Now if the landlords form a cartel during the low period, and it is not possible to lease a rental property long term, then the tenants have no choice but to be in a position to re-negotiate price during the high period. Landlords avoid having to choose between no revenue during the low period and higher during the high period, or a consistent lower rent - instead they get the lower rent during the low period (at a slightly lower occupancy rate, but shared across all the landlords) AND the higher rent during the high period.
The insanely unjust asymmetry of the “housing market” is why landlords exist in the first place.
It’s very easy to gouge people if you violently control their basic needs for survival.
Housing is often a market failure, because construction does not respond dynamically to house prices due to some regulations and nimbys.
It is, though there are more forces than that at play.
The issue here is when they get sued into oblivion it doesn’t matter. The damage has been done and the state never goes after their personal riches. Wake me up when the ceo goes to jail or has all their property seized.
Wake me up when the fines overshadow the profits.
Wake me up when capitalism is over (if humanity still exists).
I wonder what happens when enough people can’t afford this cartel pricing? History shows that when society prevents people from living comfortably they prefer to harm society than participate in it. Maybe the bread and circuses will hold this time for sure.
Between grocery prices and 12 different streaming services who keep upping their prices, we’re getting gouged on the bread and circuses too.
Then people vote for the fascists, and things get even worse
It’s no mystery and it’s been happening forever… Attacks on the homeless, imprisonment, gated compounds, etc.
Entering?
