🚨Landlords Face New Lawsuits Over Algorithmic Rent Setting
Multifamily landlords beware: new laws and lawsuits are coming
TL;DR
Landlords in major cities are facing new lawsuits and regulations targeting the use of algorithmic tools for setting rents. These laws could lead to significant penalties and changes in how multifamily housing is managed.
Landlords in major cities like San Francisco, San Diego, and Seattle are facing a wave of new lawsuits and regulations targeting the use of algorithmic tools for setting rents. These new laws, such as San Francisco's Administrative Code § 37.10C and San Diego's Municipal Code § 98.1103, prohibit landlords from using software that calculates nonpublic competitor information to advise on rent or occupancy. Each month of use for each affected dwelling unit may constitute a separate violation, with penalties of up to $1,000 per violation. This could significantly impact how multifamily housing is managed, forcing landlords to rethink their use of revenue-management products like RealPage and Yardi. If you're managing multifamily properties, you need to be aware of these new regulations and potential liabilities.
Key Points
San Francisco's Administrative Code § 37.10C prohibits landlords from using algorithmic devices that calculate nonpublic competitor information to advise on rent or occupancy, effective October 2024.
San Diego's Municipal Code § 98.1103 authorizes tenant suits for damages, injunctive relief, and penalties of up to $1,000 per violation, effective June 2025.
Seattle's Municipal Code Chapter 7.34 prohibits specified algorithmic coordinating services and provides penalties of up to $7,500 per violation, effective July 2025.
Philadelphia's Code § 9-813 permits an aggrieved person to elect statutory damages of $2,000 per violation or treble actual damages, effective February 2025.
Providence's Code of Ordinances ch. 13, art. X, § 13-69–13-73 prohibits the use of rent-setting algorithms and allows the city to bring enforcement actions, effective May 2025.
Why It Matters
If you're managing multifamily properties, these new regulations could force you to rethink your use of revenue-management products like RealPage and Yardi. Each month of use for each affected dwelling unit may constitute a separate violation, with penalties of up to $1,000 per violation. This could significantly impact your operations and financials, so it's crucial to stay informed and compliant.
Frequently Asked Questions
Why does this matter?
If you're managing multifamily properties, these new regulations could force you to rethink your use of revenue-management products like RealPage and Yardi. Each month of use for each affected dwelling unit may constitute a separate violation, with penalties of up to $1,000 per violation. This could significantly impact your operations and financials, so it's crucial to stay informed and compliant.
What happened?
Landlords in major cities are facing new lawsuits and regulations targeting the use of algorithmic tools for setting rents. These laws could lead to significant penalties and changes in how multifamily housing is managed.
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