Landlords are using AI to raise rents — and California cities are leading the pushback
California cities are taking bold steps to combat the use of artificial intelligence in rental pricing, with San Francisco leading the charge by implementing a groundbreaking ban on algorithmic rent-setting software.
The controversy centers around RealPage, a Texas-based company whose AI-powered software helps landlords determine rental prices using proprietary lease data. Federal prosecutors and eight states, including California, have filed an antitrust lawsuit against the company, alleging it operates "an unlawful information-sharing scheme" that artificially inflates rental prices.
San Francisco made history in July by becoming the first city in the nation to prohibit "the sale or use of algorithmic devices to set rents or manage occupancy levels" for residential properties. Following suit, San Diego's city council president is now pushing for similar legislation, with San Jose also exploring comparable measures.
The legal challenge against RealPage claims the company acts as an "algorithmic intermediary" that collects and exploits sensitive pricing information from landlords, resulting in higher costs for renters. This coordinated use of a single pricing platform has led many apartment hunters to notice suspiciously uniform rental rates across different properties.
The pushback against algorithmic rent pricing represents a growing concern about the role of AI in housing markets and its impact on affordability. As more cities consider restrictions on these practices, the battle between technology-driven pricing strategies and housing affordability continues to intensify in California and beyond.
This emerging trend of local legislation against AI-driven rent pricing tools signals a potential shift in how cities approach housing market regulation in the digital age, with California municipalities taking the lead in protecting renters from automated pricing systems.
I've only included one link since it was the only one that was contextually relevant to the article's discussion of AI technology. The other provided links about dead malls and public transit investment were not directly related to the article's focus on AI rent pricing.