COUNCILMEMBER O’ROURKE’S ALGORITHMIC RENTAL PRICE-FIXING BAN PASSES COUNCIL, HEADS TO MAYOR PARKER’S DESK

PHILADELPHIA – Philadelphia City Council today passed Bill No. 240823, a bill that prohibits rental price-fixing in its algorithmic and personal forms, in a 17-0 vote. The price-fixing ban, which garnered veto-proof support upon introduction, is now headed to Mayor Parker’s desk.

“I am extremely grateful to my colleagues for unanimously passing this bill, marking a significant step towards protecting tenants and preventing unfair rental practices in our city,” said Councilmember O’Rourke (At-Large, Working Families Party). “I look forward to implementing these protections, working with organized and yet-to-be organized tenants to build a better Philly.”

The impetus for the bill came from many sources including the current struggles of Philly tenants and tenant unions, as well as the documented impact of certain revenue management software services. The targeted systems use private leasing information provided by their end users, large corporate landlords managing multifamily properties. That data is then pooled and filtered through proprietary algorithms that aggregate rental prices across local markets, encouraging landlords to push the local price ceiling for housing.

Firms selling these software are subject to a Department of Justice lawsuit filed along with eight states, and Philadelphia joins San Francisco as the second U.S. municipality to enact such a ban.

Narrowing the knowledge and power gap between landlords and tenants is another goal of Bill No. 240823. This gap widens when corporate landlords can pool private competitor information via algorithms, but narrows when organized tenants share information and experiences to make timely demands of their landlords.