Tenants have filed a class-action lawsuit against a real estate software firm and numerous large property owners and managers in southern and central Florida, alleging that the defendants engaged in a price-fixing scheme to drive up rents and company profits.
The federal lawsuit was filed Jan. 13 in the Southern District of Florida against the software firm RealPage as well as property managers such as Camden Property Trust and Lincoln Property Co. The lawsuit argues that RealPage’s widely used software platform results in coordinated price setting in the Miami, Orlando, Jacksonville and Tampa regions.
“With the assurance that their competitors are respectively setting Miami, Orlando, Jacksonville and Tampa rental prices using the same algorithm, each defendant property manager could allow a larger share of their units to remain vacant while maintaining higher rental prices across their properties,” the complaint states. “This increased their revenue at the expense of renters.”
In addition, the software also makes recommendations to property managers about lease renewal dates in a way that staggers the dates and avoids periods of oversupply that normally occurs in traditional rental markets, according to the lawsuit.
The result adds up to a price-fixing conspiracy that leads to inflated rent prices and a depressed supply of units in the state’s largest metro areas, the complaint says.
But RealPage contends the allegations in the class action, which argues that the defendants’ actions violate federal antitrust laws, are false.
“RealPage believes the allegations are completely without merit and will vigorously defend against the lawsuits,” a company statement emailed to the Florida Record says. “The complaints filed are wrong on both the facts and the law. Beyond that, we do not comment on pending litigation.”
In a statement provided to the nonprofit news-gathering organization ProPublica prior to the filing of the lawsuit, RealPage emphasized that its software allows renters to search for units based on preferred term length and rent amounts, eliminating bidding wars that can result in manual pricing, the company said.
In addition, renters using RealPage software spend only 23.2% of their income on rents, compared to nearly half of renters nationwide paying more than 30% of their income on housing, according to RealPage.