Yardi’s rent-setting software program illegally drove lease costs up for tens of millions of renters: lawsuit

A renter in Seattle final week filed an antitrust class motion lawsuit towards 18 property administration firms, together with property administration firm software program Yardi Methods Inc., accusing them of violating antitrust legal guidelines. The plaintiff is accusing the defendants of getting orchestrated a nationwide scheme to illegally drive lease progress to unprecedented ranges through the pandemic.

By outsourcing the administration of rental pricing to RENTmaximiser, Yardi’s rent-setting software, property administration firms failed in complying with the antitrust legal guidelines, based on the lawsuit. By 2013, the software program was used to cost 8 million residential items, attorneys for the plaintiffs argued.

“RENTmaximizer successfully outsources the administration of rental pricing from a landlord to Yardi itself, which then implements greater costs collectively throughout a gaggle of landlords,” the lawsuit alleged. “Defendants who agree to make use of RENTmaximizer perceive that its goal is to foil the operation of the aggressive market.”

This new case is barely the newest class motion lawsuit filed by a renter who alleges {that a} rent-setting algorithm helped illegally drive lease progress.  It comes on the heels of one other case in Tennessee, by which a gaggle of renters accused rental tech agency RealPage of organizing a “cartel” involving among the nation’s largest landlords.

Moreover, the usage of this software program prevented landlords from courting would-be renters by the usage of completely different reductions, mentioned the lawsuit. As an illustration, landlords generally provide move-in offers or compete on costs however the usage of Yardi’s algorithmic pricing software disrupted that observe, claimed the attorneys. RENTmaximizer contributed to the rise of upper costs collectively throughout a gaggle of landlords, therefore eliminating the reductions that would have occurred in a aggressive market, the lawsuit said. 

Yardi marketed its instruments to rental firms as a technique to “beat the market” and maximize income. In the meantime, it marketed to renters that RENTmaximizer was giving them “full visibility” into the market, and supplied  them with “property efficiency benchmarking,”the lawsuit said.

General, the speed of lease progress has fallen again towards historic norms after almost two years of traditionally excessive progress.