[ok_dad]

This software is collusion, and anyone using it today should be penalized. I don’t care what excuse they have, it’s clear to someone with half a brain (most landlords have at least half) should realize software that fixes prices for you based on local demand is going to be collusion. It’s pretty clear how that stuff works, the only unclear thing is if there is a loophole or judge which will let the landlords off in favor of the zombie economy over actual humans.

[arcticbull]

The collusion here is what, that they all agreed to use the same software?

What if I create software that recommends rates to charge, and I market it. Proven to get you up to 20% or more extra rental income! Then everyone just happens to use my software, and the rates are then 'recommended' to everyone based on an analysis of what the market will bear. No collusion. Is a law broken in this case? Or is the market just lacking in competition.

The software isn't making landlords do anything, it's recommending an optimal market price. Is it any different than a quote from a commodities futures exchange being used to price corn at the local grocery store?

[anigbrowl]

Then everyone just happens to use my software

knowing what it does, yes that is collusion. Look at the etymology of the word: it literally means 'playing together'. It doesn't require people to meet up in a smoke filled room in supervillain outfits and say 'let's collude, heh heh heh'. Everyone is sharing their rental data to help the software calculate the optimal price, and everyone wants to get extra rental income, per your scenario. The diffrence from the commodity exchange is that exchange operators are not promising specific price outcomes for commodities.

[arrosenberg]

The whole point of pro-competition laws is to stop large corporations or a cartel from using market power to control pricing, which is the scheme you just laid out. So, yes, that would be illegal. You can say "no collusion", but you (the operator) have effectively organized a cartel. Each individual landlord may escape liability, but you will not.

Commodities exchanges (I believe) work on a competitive bidding system, which is basically the opposite - you have willing buyers and sellers with roughly equal power/information.

[arcticbull]

> The whole point of pro-competition laws is to stop large corporations or a cartel from using market power to control pricing, which is the scheme you just laid out. So, yes, that would be illegal.

How is a Zestimate or Redfin home value estimate legal then? Or a Redfin rental estimate? [1] Would it become illegal - or a cartel - if too many people started using it to set rents?

Should we forbid tools to help landlords figure out how much their places should rent for?

[1] https://www.redfin.com/rental-estimate

[arrosenberg]

It might be. RealPage's definitely is because they've clearly accrued market power in order to control pricing. In Redfin's case it seems like more of a marketing gimmick, but if you could prove it had a meaningful effect on driving prices up, then yes, the FTC should order its' removal.

> Should we forbid tools to help landlords figure out how much their places should rent for?

It depends? Playing moneyball (i.e. charging the maximum the market will bear without a serious, violent response) with a necessity like rent should be illegal, and many of these tools seem designed to do that using market power, which is explicitly illegal. If the tool just gave some local averages based on things like amenities, that might be ok.

[sinistersnare]

Yes, if it causes harm to people. Being a landlord is a job (so I'm told), do some math, figure out how much is fair (cost:labor calculation) then ask on the open market if people want to pay that. The problem is that the underlying system here did NOT do this calculation, hence price-gouging. It is the lack of free market that is the problem, thanks to this price centralization.

[cscurmudgeon]

Collusion requires intent to collude. If they knew using the software was collusion and willingly used it, then only it is collusion.

[mattmaroon]

It’s not collusion if the landlords don’t know it is price fixing and they really may not. Collusion definitely requires mens rea.