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Yahoo
2 days ago
- Business
- Yahoo
Jersey City, New Jersey Shuts Down AI, Banning Landlords From Using The Latest Price Setting Software To Artificially Increase Rents
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Jersey City, New Jersey, has banned algorithmic software favored by landlords for setting prices and collecting payments. The City Council voted unanimously on May 21 to ban the use of AI-driven software, such as RealPage and Yardi Systems, which critics have blamed for artificially inflating rents. Advocates of the ordinance, a first for the Garden State, are not alone in their criticism. The Biden Justice Department sued RealPage for the same reasons. However, the tax bill in the Senate aims to bar the ban, The Wall Street Journal reports. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — , which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Under the Jersey City ordinance, the use of algorithmic software based on AI will be a code violation. City Council member James Solomon, who introduced the ordinance, called the new law a "bold stand" against landlords colluding to force rents higher by using the software. "With the passage of this first-in-the-state legislation, we are putting corporate landlords on notice: if you're using software like RealPage to coordinate rent hikes, you're breaking the law — and now, tenants and the city have the tools to hold you accountable," Solomon told the New York Post. Under the ordinance, residents would be able to sue their landlords and submit complaints to the city, should they suspect that management companies or landlords have been using banned software. Rents in Jersey City have increased by 50% since 2015, according to a 2024 report by the nonprofit Regional Plan Association. Rent Cafe lists the average rent in Jersey City as $3,702 for a 791-square-foot apartment, making it one of the most expensive rental cities in the U.S., reports the Gothamist. Trending: Invest Where It Hurts — And Help Millions Heal: The ordinance, as evidenced by the new GOP tax bill, is not without its detractors who, according to The Gothamist, feel that the law doesn't get to the heart of the issue — a lack of housing. Other landlords fear that the general language used in the bill leaves landlords who are not using algorithmic pricing open to penalties. The ordinance blames algorithmic pricing as a tool used by landlords to aggregate various factors that determine rent prices — including market rates, lease length, supply levels, and more — to tip the scales in favor of landlords when calculating rental prices. The Washington Post identified 3.1 million market-rate rental units under the management of companies named in the Department of Justice lawsuit in January. According to the Post, there were 10 counties where more than 1 in 3 multifamily units are managed by a property company allegedly using a rent-setting program from RealPage. The DOJ's suit alleged that one landlord, utilizing RealPage revenue management software, began increasing rents within a week of implementing the technology and raised rents by more than 25% in 11 months, according to The reported in 2022 that it also found evidence of faster rental increases in cities where RealPage's YieldStar software was used by property management firms. New Jersey Attorney General Mathew Platkin has taken up a separate case against algorithmic pricing, filing a suit in April against the Garden State's largest landlords and RealPage, alleging that "tens of thousands" of New Jersey residents overpay in rent. "The defendants in this case unlawfully lined their pockets at the expense of New Jersey renters who struggled to pay the increasingly unlivable price levels imposed by this cartel," Platkin stated in a statement. Real estate is a great way to diversify your portfolio and earn high returns, but it can also be a big hassle. Luckily, there are other ways to tap into the power of real estate without owning property. Arrived Home's Private Credit Fund's has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate. The best part? Unlike other private credit funds, Looking for fractional real estate investment opportunities? The features the latest offerings. Image: Shutterstock This article Jersey City, New Jersey Shuts Down AI, Banning Landlords From Using The Latest Price Setting Software To Artificially Increase Rents originally appeared on
New York Post
23-05-2025
- Business
- New York Post
Jersey City just banned landlords from using AI to sent rent — a first for the Garden State
Jersey City landlords are going to have to set rent the old fashioned way. The Jersey City Council voted unanimously on Wednesday to ban the use of AI-driven, rent-setting software by landlords. The ordinance, introduced by Councilmember James Solomon, is the first of its kind in the Garden State. Advertisement 5 Using AI-driven rent-setting software is officially a code violation in Jersey City. Blacqbook – 5 Jersey City Councilmember James Solomon. Jersey City The amended ordinance makes a code violation out of use of tools from rental software firms like RealPage or Yardi Systems. Advocates of the ordinance claim these tools help landlords and property management companies to artificially inflate rents and constrain supply. Advertisement Solomon, in a statement provided to The Post, called the move a 'bold stand' against rent collusion. 'With the passage of this first-in-the-state legislation, we are putting corporate landlords on notice: if you're using software like RealPage to coordinate rent hikes, you're breaking the law — and now, tenants and the city have the tools to hold you accountable,' the statement said. Enforcement of code violations includes the ability for residents to sue landlords or submit complaints to the city over the use of algorithmic rent-setting, according to Solomon. Detractors of the new ordinance say the measure fails to address the root of the problem — a lack of new housing supply. Others argue that the language of the bill is overly broad and could lead to unnecessary penalization for property owners, Gothamist reported. Advertisement 5 Jersey City and New York City share a beautiful river and a big housing problem. Mariusz – 5 Jersey City is among the most expensive places to rent in the country. James – Jersey City has a documented affordability problem. Rent prices in the city have increased by 50% since 2015, according to a 2024 report by the nonprofit Regional Plan Association. The city was the country's third most expensive city to rent in April, according to Zumper, right after New York City and San Francisco. Proponents of the new ordinance pin the problem, in part, on landlords' use of AI-driven tools to raise rents. Advertisement These tools, according to the bill, aggregate local prices, supply levels, occupancy rates and lease details. The information allows landlords to boost profits by selecting the most financially advantageous rental prices, lease terms or occupancy levels for their buildings. A 2022 ProPublica investigation found evidence of faster price increases in cities where RealPage's YieldStar software was widely adopted by major property management firms. 5 RealPage and other companies like it have been the subject of multiple lawsuits in recent years over the uses of their software. SOPA Images/LightRocket via Getty Images The ordinance comes on the heels of a similar bill proposed in fall 2024, which is currently stalled in the state Legislature, Gothamist reported. New Jersey Attorney General Matthew Platkin filed his own lawsuit in April against 10 of New Jersey's largest landlords and RealPage over the alleged use of software that forced 'tens of thousands' New Jersey residents to overpay for rent. 'The defendants in this case unlawfully lined their pockets at the expense of New Jersey renters who struggled to pay the increasingly unlivable price levels imposed by this cartel,' Platkin said in a press release. RealPage and Yardi could not be reached for comment by press time.
