Last month, the San Francisco Board of Supervisors approved a city ordinance that would ban the use of algorithmic pricing software for rental housing. San Francisco’s housing crisis is among the very worst in the nation, with a constricted housing supply and massive wealth inequality pricing most people out of the ability to afford a home. This is happening while the city continues to enjoy steady economic growth according to the metrics that matter most for the wealthy.
To many, the solution seems simple: San Francisco needs to build more housing. Restrictive zoning laws, an undermanned home construction industry, and high interest rates have constrained both the supply and the ability to afford housing on an average salary. But a lack of supply doesn’t tell the entire story.
Enter RealPage, a real estate revenue management company that provides computer-generated pricing recommendations to over thirty-one thousand landlord clients managing over 19.7 million rental units across the country — recommendations that always seem to favor raising rents, no matter the vacancy rate or basic shelter needs.
The company has reported that it provides these services to 10 percent of the rental market in San Francisco. Critics, such as San Francisco board president Andrew Peskin, say that RealPage facilitates collusion between landlords and drives up rental prices beyond what the already tight market should theoretically bear. This sentiment is shared by many across the country, with investigations and lawsuits mounting against the use of RealPage’s software, which some are accusing of price-fixing.
San Francisco and other American cities could certainly benefit from more housing. But they also need to reckon with a rogue landlord cohort that…
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Auteur: Akil Vicks
