Stet NewsThe algorithm turns market-based competition on its head, South Florida plaintiffs argue in their antitrust suits.
Spurred by sky-high apartment prices, four South Florida rent-price lawsuits have been bundled and will join almost two dozen others in Tennessee federal court.
Why we care: The median monthly rent for a one-bedroom apartment in West Palm Beach is $1,760, Zillow reports. That’s up $280 from a year ago.
A 565-square-foot apartment in Mangonia Park goes for $1,275
A three-bedroom in Delray Beach is priced at $13,796.
Rents aren’t the only thing rising.
Eviction rates are sharply up, too.
There are plenty of suspects for double-digit hikes. Was it New Yorkers willing to pay big bucks for small spaces? Foreign investors?
An algorithm?
The algorithm in Dallas-based RealPage Inc.’s software turns market-based competition on its head, South Florida plaintiffs charged in their antitrust suits. They target not just RealPage, but marquee-name apartment management companies operating throughout the United States, including in Palm Beach County.
Among the renters’ arguments: Landlords can figure out if other landlords will keep rents high. There’s no market pressure driving prices down.
It has “the exact same purpose and effect as if they met in a smoke-filled backroom and … set prices directly,” one suit claims.
RealPage has supporters. For one thing, they say, it’s unlikely every apartment management firm in a city — especially a large one — would be using RealPage, making price fixing difficult, if not impossible.
What happens next? Nothing fast. The South Florida cases and others consolidated in Tennessee come from all over the country. Just sorting out the lawyers for all sides will take some time.
You can read a ProPublica story on RealPage here, and details of one South Florida lawsuit, here.
