Dive Brief:
- Richardson, Texas-based software and data analytics provider RealPage issued a statement last week that it said was intended to “correct factual inaccuracies” in the media and legal filings about the company’s revenue management software and its impact on renters.
- RealPage said that starting in October 2022, when a ProPublica exposé took aim at the company’s software, “false and misleading” statements have been made about the company and its software. “The time is now to address a number of false claims about RealPage’s revenue management software and how rental housing providers operate when setting rent prices,” Dana Jones, RealPage CEO and president, said in the statement.
- The company said that these claims threaten to undermine the benefits that RealPage’s solutions provide to renters and housing providers. The firm contends that its revenue management software contributes to a “healthier and more efficient rental housing ecosystem.”
Dive Insight:
Since late 2022, renters and attorneys general have filed over 30 lawsuits against Yardi, RealPage and assorted multifamily providers in state and federal courts, alleging that the price-setting software the companies provide or use enables competitors to collude on rent prices. RealPage is also the subject of a criminal investigation by the Department of Justice and state attorney generals.
In its statement, RealPage said that its customers “always have 100% discretion to accept or reject software price recommendations” and are never punished for declining recommendations. In a suit filed last year, Washington, D.C., Attorney General Brian Schwalb claimed that the company policed its contracts and that landlords abided by its suggested rents more than 90% of the time.
Clients using the company’s AI Revenue Management and YieldStar products accept pricing recommendations for new leases less than 50% of the time, according to the statement.
The company’s revenue management software also can make price recommendations to lower rents or not change them, according to the company. “RealPage revenue management software never recommends that a customer withhold vacant units from the market,” the company said in the statement. “In fact, properties using our revenue management products consistently achieve vacancy rates below the national average.”
RealPage said that its services serve a smaller pool of rental units than has been publicized. In Washington, D.C., Schwalb claimed that 90% of units in buildings with 50 or more apartments use RealPage software. Overall, the product is used by operators of 50,000 units in the District.
However, the RealPage statement said less than 7% of units nationally use RealPage’s AI Revenue Management and YieldStar, while fewer than 4% use the Lease Rent Options product.
The company also claimed that its software offers options and flexibility in lease terms, aids compliance with Fair Housing laws, does not use any personal or demographic data to generate rent price recommendations and helps ensure that prospective residents have access to the best pricing available.
In the company statement, Jones shifted the blame to overall housing affordability for the skyrocketing rents in the market.
“Housing affordability should be the real focus. RealPage is proud of the role our customers play in providing safe and affordable housing to millions of people,” Jones said. “Despite the noise, we will continue to innovate with confidence and make sure our solutions continue to benefit residents and housing providers, alike.”
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