It’s no secret that California’s rent is out of control, but now there’s a new villain: algorithmic rent-setting software. Nothing says “let’s solve the housing crisis,” like letting AI decide how much more you should fork over for your studio apartment.
Enter RealPage, a Texas-based company offering landlords AI tools to “maximize revenue potential,” which is corporate-speak for jacking up rents while eliminating pesky negotiations. The software uses private data to suggest prices and, according to critics, turns landlords into a rent-hiking hive mind.
The U.S. Department of Justice and eight states, including California, do not accept RealPage’s claims that its software provides “safe and affordable housing to millions of people.” In August, they sued the company, accusing it of facilitating an illegal price-fixing scheme by encouraging landlords to share data and align rent prices.
As the lawsuit puts it, RealPage “replaces competition with coordination,” leaving renters to pay the price while landlords count their profits. California Attorney General Rob Bonta didn’t mince words, calling the AI-driven practices “anti-competitive” and illegal—whether done by humans or software.
Tenant advocates say RealPage isn’t just inflating rents; it’s worsening California’s homelessness crisis. By helping landlords collude, these tools don’t just squeeze existing tenants but also warp entire rental markets, leaving fewer affordable options for everyone.
RealPage, of course, denies everything, blaming the housing shortage and accusing the media of spreading “misinformation.” CEO Dana Jones claims their tools benefit landlords and tenants. Sure, Dana. Just like oil spills benefit fish.
While the federal lawsuit unfolds, California cities are pushing back. San Francisco became the first to ban AI rent-setting software, and cities like San Jose and San Diego are exploring similar moves. L.A.’s City Council is also eyeing a ban but hasn’t acted yet.
If RealPage’s AI feels dystopian now, consider this: a second Trump presidency could stall the lawsuit entirely, as his administration has historically been soft on antitrust enforcement. For now, renters are left praying their next “AI-optimized” rent hike doesn’t push them out onto the street.