U.S. authorities to scrutinize AI-powered housing-rental service

The U.S. Department of Justice has opened an investigation into RealPage, the company developing software to assess rents using AI. The matter is reported by The Register.

The investigation began after a letter to Deputy Attorney General for Antitrust Jonathan Kantor from Senators Amy Klobuchar, Richard Durbin and Cory Booker.

“We urge you to investigate the recent allegations of anticompetitive collusion that have led to a substantial rise in apartment rents,” the lawmakers said.

They contend that RealPage’s pricing algorithm could push landlords to charge the rate recommended by the software. This puts upward pressure on prices and reduces the availability of listings, the senators said.

RealPage software weighs various data types and offers an assessment of a property for owners. It takes into account the size, location, and rent levels of nearby apartments. System users can decide whether to accept the software’s recommendations or not.

Earlier, five tenants sued RealPage, accusing the company of enabling property owners to conspire and act as a “cartel” to raise prices. The program allegedly advised landlords to leave a certain number of units vacant to boost demand and set higher charges.

If investigators find that the algorithm enabled manipulation of the housing market, RealPage could face liability under federal antitrust law.

A company spokesperson rejected the allegations:

“RealPage’s revenue-management software is specifically designed in compliance with the law.”

As reported earlier, in October the U.S. Department of Justice opened a criminal investigation into Tesla over its statements about the capabilities of the Autopilot system.

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