Dive Brief:
- RealPage has reached a settlement with the State of Nevada regarding its rent-setting software, which had used nonpublic data provided by clients to calculate price recommendations, allegedly driving rents artificially high.
- Nevada Attorney General Aaron Ford contended that the nonpublic information RealPage gathered resulted in rent recommendations that cut into competition and harmed Nevada tenants, per a Sept. 19 press release shared with Multifamily Dive.
- RealPage denies allegations of wrongdoing and decided to settle to avoid the costs and distraction of potential litigation, according to a Sept. 19 press release from the Richardson, Texas-based real estate software provider.
Dive Insight:
Last August the Department of Justice filed suit against RealPage — and in January added six major apartment landlords, including Greystar — for allegedly “participating in algorithmic pricing schemes that harmed renters.” Nevada’s lawsuit is just one of a series of similar complaints that state and local governments and renters have filed since then.
RealPage denies the claims, and attributes rent price increases to the COVID-19 pandemic. Nonetheless, “In response to legislative activity, RealPage previously modified its revenue management software to remove nonpublic data of unaffiliated properties from the calculation of rent recommendations for all customers’ properties,” according to its release.
Per the settlement, RealPage does not admit any wrongdoing and it is released from all claims by the Nevada Attorney General’s office related to its software. The terms include:
- RealPage may use nonpublic data of other unaffiliated properties in the runtime operation of its revenue management software to calculate rent recommendations for properties in Nevada only if such data is aged at least three months, anonymized and aggregated to at least 10 properties.
- RealPage may publish nonpublic data regarding rent, occupancy or availability to its customers in Nevada only if such data is aggregated to at least 10 properties and anonymized.
- Without limiting affiliated properties’ use of their own data, RealPage revenue management software may use machine learning models trained with nonpublic data from properties in Nevada only if that data is aged at least three months.
RealPage will also maintain an antitrust compliance program with training for revenue management personnel, and contribute $200,000 to Nevada for rent relief for low-income state residents.
“We are gratified we found a path forward with the State of Nevada,” RealPage CEO and President Dana Jones said in the release.
