CEO Dana Jones countered in a statement Tuesday that RealPage is not responsible for a lack of rental supply, increased demand for housing or inflationary pressures impacting the market.
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Property management software giant RealPage broke its silence Tuesday morning on a class-action lawsuit against it and a federal criminal antitrust investigation into its Yardi software.
RealPage CEO Dana Jones claimed in a statement that “false and misleading claims” about the company’s revenue management software had been reported and denied that the company was responsible for widespread rent increases.
“It’s time to address some of the false claims about RealPage revenue management software and how rental housing providers work when setting rental prices,” Jones said. “Housing affordability should be a real focus. RealPage is proud of the role our customers play in providing safe and affordable housing to millions of people. Despite the noise, we will continue to innovate with confidence and Ensuring our solutions continue to benefit residents and housing providers.
Numerous class-action lawsuits accuse landlords of using RealPage’s Yardi software to coordinate a campaign to raise rents to unprecedented highs by using RealPage’s algorithms to share rental price data with other providers. The lawsuit alleges that the price and occupancy sharing agreement constituted a “cartel.”
The lawsuits also named several rental housing operators, some of which have since settled, such as Pinnacle Property Management Services and Apartment Income REIT, one of the largest property management companies in the United States.
The same claims laid out by the lawsuits have reportedly inspired the Department of Justice to launch a criminal investigation into RealPage, with reports indicating that the DOJ is looking into the possibility RealPage helped facilitate price fixing at some of the large rental properties whose owners use the Software. The criminal investigation was launched after the Justice Department filed a brief in support of a class action lawsuit against RealPage.
In supporting the tenants’ case, the Justice Department said, “In short, RealPage allegedly displaced independent price competition decisions, which would have typically resulted in lower prices for tenants, and its combination of price fixing violated” antitrust laws.
In a statement, RealPage noted that housing affordability is a real issue and believes it is not responsible for the continued lack of supply of rental units, increased demand for rental housing, and the inflationary pressures currently affecting the housing market.
It also claims that RealPage customers set their own prices, can accept or reject software price suggestions at their discretion, are not penalized for rejecting software suggested rentals, and accept proposals at different prices that they claim are lower than those reported.
RealPage noted in a statement that its price recommendation software can provide recommendations in both upward and downward directions, and that it never advises clients to withhold vacant units from the market. The company claims that clients using its software maintain rental vacancy rates well below the national average, but does not provide specific statistics.
“RealPage revenue management software provides potential residents and housing providers with more choice and flexibility in rental terms, helps comply with fair housing laws, does not use any personal or demographic information to generate rental price recommendations, and helps Ensuring potential residents receive the best deal available to everyone,” the statement read.
However, some of these claims are contrary to comments made by RealPage executives at the 2021 meeting, which were first reported by ProPublica in 2022.
“We’ve never seen these numbers before,” Jay Parsons, then-RealPage vice president, said of the recent 14.5% increase in apartment rental prices. According to ProPublica, Parsons then asked a colleague if their software was working.
“Honestly, I think this is driving the trend,” replied Andrew Bowen, another RealPage executive. “As property managers, few of us are willing to manually raise the rent by double digits in a month.”
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