The city of San Francisco has lost over 60,000 residents since the onset of the Covid-19 pandemic according to the census (3,660 in 2020; 55,136 in 2021; 4,605 in 2022). There’s been a bit of a resurgence since then; 2023 shows a net gain of a whole 276 people. But still, that’s a lot of missing persons in a city of a little over 800,000. Why is it that rent payments, while still lower than the recent peak in 2019, are still so high? Is there someone we can blame?
On Tuesday afternoon, the San Francisco Board of Supervisors moved one step closer to answering that question, by passing an ordinance authored by Supervisor Aaron Peskin banning the sale or use of any algorithmic device that sets, or even recommends, rents or vacancy levels for residential properties in San Francisco.
If it’s signed by Mayor London Breed, which seems likely, San Francisco will be the first city in the country with legislation of this kind.
It’s possible that the case of San Francisco’s surprisingly resilient post-pandemic rental prices is due to other factors. But RealPage, a Texas-based software company that Peskin’s office estimates is used by as much as 70 percent of the rental housing in San Francisco, is probably not helping. According to its own marketing materials, the company collects confidential property data from different landlords — the kind of data that landlords would otherwise work hard to hide from each other in a competitive marketplace, and uses this data to keep rents high by any means necessary, including: Setting price floors, keeping units vacant and timing the length of property leases so large numbers of units don’t come up for rent in the same geographical area at the same time.
In the past, this kind of behavior has been viewed as illegal price-fixing under the Sherman Act. Odds are high that at least some of it is illegal now. That’s what the Department of Justice contends, at least.
On Aug. 23, 22 days after Peskin introduced his legislation, the DOJ issued a complaint against RealPage, describing it as having “built a business out of frustrating the natural forces of competition.” The complaint goes on to describe a company so determined to keep rents high that it has a policy of reporting individual property managers who refuse to accept its recommendations to their superiors. The feds also found that the company works aggressively to keep rents from falling even when the market is obviously shifting, to the point where one client complained that it kept pressuring him to raise prices even as his building emptied out.
“It’s really important that so many lawmakers are taking a closer look at this,” said Lee Hepner, senior legal counsel for the American Economic Liberties Project and a former Peskin legislative aide. Hepner first became aware of RealPage after ProPublica published an article about the company in 2022, and began working on a memo with a progressive local policy group called Local Progress, on ways that municipal and state governments could begin taking action on their own.
The San Francisco ban is based partly on the federal Preventing the Algorithmic Facilitation of Rental Housing Cartels Act from Sen. Ron Wyden (D-Ore.) (introduced in January, still in committee), which would outlaw the use of algorithmic price-setting software in the rental housing market nationwide. It was also partly based on state legislation that was drafted in Colorado, but didn’t pass.
Since he and his colleagues wrote the ordinance early this summer, says Hepner, representatives of other cities have already approached them about using it themselves. “This legislation is only effective to the extent that lawmakers understand the behavior that RealPage is engaged in. That can be tricky with emerging technology — there’s an asymmetry of information between a company and what the public is aware of.”
That said, RealPage (and any competitors past, present, and future) aren’t specifically banned in San Francisco. Neither is the act of setting rents at wildly imaginative levels, keeping residential property vacant (though there is a tax on that), or even writing software to help you do either of the above. Primarily it’s the collusion — the use of shared data to set prices and artificially constrict supply and demand — that is illegal, said Hepner.
Enforcement could be tricky. Under the new legislation, the city can sue RealPage — and property owners that use it — if they suspect them of continuing to fix prices, and tenants can sue landlords on the same grounds. A lot will depend on the information that future lawsuits reveal about how RealPage is operating in the city.
San Francisco’s ability to push the envelope with this kind of legislation has a lot to do with a city attorney’s office that is willing to risk the city getting sued. In a conversation on July 29, while campaigning in the Mission the night before the RealPage legislation was introduced, Peskin described taking the idea to City Attorney David Chiu. Novel concept, Peskin recalls Chiu telling him — but why not?
At the time, it seemed like perhaps RealPage’s response to the legislation would mirror what Airbnb did when the city passed legislation in 2015 that fined it $1,000 per day for every unregistered host using the platform. “They sued us,” Peskin reminisced. “They said that we’re violating the United States Communications Decency Act, which basically says you can do whatever you want on the internet.”
RealPage can still try. But last week, the Third Circuit of the United States Court of Appeals unexpectedly ruled that the Communications Decency Act — specifically, Section 230, the part used as a shield against liability by tech companies since 1996 — is toast.
It’s a decision with big implications for every local government that has found itself blindsided by evolving technology. “I think RealPage’s, days of fixing rents are numbered,” said Hepner. “That’s a profoundly positive development for tenants — not just in San Francisco, but across the country.”
About the author
History Says the Nasdaq Will Surge in 2025. 1 Stock-Split Stock to Buy Before It Does.
The Nasdaq Composite has been on fire over the past couple of years, driven higher by the advent of artificial intelligence (AI), improving economic conditions, an uncontested election, and the Federal Reserve Bank's recent moves to cut interest rates. After returning 43% in 2023, the tech-centric index is up roughly 30% in 2024. History suggests the rally will likely continue into 2025. The current bull market began on Oct. 12, 2022, and while every rally is different, history can provide important context. Bull markets last more than five years, on average. Since the current rally just entered its third year, there's a strong likelihood the Nasdaq will continue to gain ground next year. It's also worth noting that the Nasdaq has generated gains 73% of the time, dating back 53 years, so history is on the side of investors. Finally, […]
Yellow Moto closing today, its owners moved on to Spain
Beloved Yellow Moto Pizzeria at 18th and Valencia streets is having its last day of service today, after five years at the corner.“I’m heartbroken, really,” said Allison White, 40, wife of Yellow Moto owner David White. “It always felt like an extension of my home, and it’s going to be hard to say goodbye.” Allison and David’s kids used to hang out in the back of Valencia Street Vintage, a small business right next door to Yellow Moto that Allison owns. In earlier press interviews and on Friday, White and her husband David, said that business has slowed. But other factors played into their decision.The family that used to live four blocks away at 14th and Guerrero streets moved across the ocean to Valencia, Spain in August.“We did it for our kids. We have three kids — 8, 11 and 12,” […]
Ukraine’s secret weapon in its battle against Russia: crowdfunding
On April 27, 2023, Diana Kulyk's father told her he was leaving the next day to start training to fight Russia. She was filled with dread but knew she needed to act. Her hands shaking, Kulyk, a 24-year-old only child, tried to type the perfect tweet that would convince her roughly 20,000 followers to donate more than $3,000 for equipment that would help keep her father alive."Hello, this is the most important tweet I have ever written," she began. "I'm Diana Kulyk, daughter of Ruslan Kulyk. My father is a simple man, a baker by profession, a human being full of love and care. The person who took care of me since I came into this world. He needs help." Beneath the text were two images: a selfie of Diana and Ruslan smiling under golden-hour sunlight, and a spreadsheet of […]
Born and raised
Born and raised Source: missionlocal.org
Syrians Pose Next to Head of Toppled Statue of Hafez al-Assad in Hama
The head of a toppled statue of former Syrian president Hafez al-Assad was seen on the ground of a square in the city of Hama on Friday, December 6, after opposition forces took control of the city.Footage captured by Obada Jbara shows two boys holding Syrian opposition flags, as one of them steps on the head of the statue of Hafez al-Assad – father of the current Syrian regime president, Bashar al-Assad – in Hama’s Assi Square.Footage shared by several news outlets on Thursday reportedly shows people toppling a statue of al-Assad in Hama. Credit: Obada Jbara via Storyful Source: www.yahoo.com
Planning Commission advances Mission anti-displacement plan
Read Mission Local often?If so, consider supporting us — San Francisco’s premier independent, nonprofit newsroom — during end-of-year fundraising. We’re almost at our $200,000 goal! The San Francisco Planning Commission on Thursday voted unanimously to endorse the Mission Action Plan 2030 — an updated version of the city’s existing plan to fight displacement in one of the neighborhoods hardest hit by gentrification.The plan, said Miriam Chion, the director of community equity at the planning department, “becomes the compass for city strategies, program legislation and investments.” The new plan largely maintains the city’s current priorities for the Mission — “secure funding at all levels” to build affordable housing, strengthen tenant protections for “vulnerable Mission Latino residents,” protect businesses and nonprofits in the area, and “preserve and promote cultural resources” across the neighborhood. But, in a nod to changing post-pandemic conditions along the Mission’s […]
Related
Yellow Moto closing today, its owners moved on to Spain
Beloved Yellow Moto Pizzeria at 18th and Valencia streets is having its last day of service today, after five years at the corner.“I’m heartbroken, really,” said Allison White, 40, wife of Yellow Moto owner David White. “It always felt like an extension of my home, and it’s going to be hard to say goodbye.” Allison and David’s kids used to hang out in the back of Valencia Street Vintage, a small business right next door to Yellow Moto that Allison owns. In earlier press interviews and on Friday, White and her husband David, said that business has slowed. But other factors played into their decision.The family that used to live four blocks away at 14th and Guerrero streets moved across the ocean to Valencia, Spain in August.“We did it for our kids. We have three kids — 8, 11 and 12,” […]
Born and raised
Born and raised Source: missionlocal.org
Planning Commission advances Mission anti-displacement plan
Read Mission Local often?If so, consider supporting us — San Francisco’s premier independent, nonprofit newsroom — during end-of-year fundraising. We’re almost at our $200,000 goal! The San Francisco Planning Commission on Thursday voted unanimously to endorse the Mission Action Plan 2030 — an updated version of the city’s existing plan to fight displacement in one of the neighborhoods hardest hit by gentrification.The plan, said Miriam Chion, the director of community equity at the planning department, “becomes the compass for city strategies, program legislation and investments.” The new plan largely maintains the city’s current priorities for the Mission — “secure funding at all levels” to build affordable housing, strengthen tenant protections for “vulnerable Mission Latino residents,” protect businesses and nonprofits in the area, and “preserve and promote cultural resources” across the neighborhood. But, in a nod to changing post-pandemic conditions along the Mission’s […]
It’s timeee!
It’s timeee! Source: missionlocal.org
La Doña headlines Encuentro del Canto Popular at the Chapel
Holding a fundraiser in a funeral home might not seem like a recipe for joy — or longevity. But after more than four decades, the Encuentro del Canto Popular continues to thrive as one of the region’s signature Latin music events. Launched as a one-off in 1982 by a young attorney named Bill Martinez and Juan Gonzalez — founder of the Mission newspaper El Tecolote — the first six-act program took place in the chapel of what was then Halsted & Co. Funeral Directors on Valencia Street.Over the years, the annual event has presented some of Latin American music’s most illustrious stars at venues around the city. But on Sunday, Dec. 8, the 43rd annual Encuentro returns to the same location where it started — which is now the music venue known as The Chapel. A fundraiser for the arts […]
Murder trial: Bob Lee used apparent knife for cocaine in new video
In a bombshell revelation on day two of closing arguments, Nima Momeni’s defense team said Cash App founder Bob Lee was using a knife to do cocaine hours before he ended up stabbed. The allegation, supported by a video shown to jurors today for the first time, may bolster the claim that Momeni, on trial for murder, stabbed Lee in self-defense after Lee attacked him with a knife.In the video, Lee and his friend Bo Mohazzabi are standing outside The Battery, a members-only club where they had drinks on the evening of April 3, 2023 — hours before Lee was killed. They each in turn bend forward to do a bump of apparent drugs off a long pointy object that protrudes out of Lee’s hand, and glints in the light. Lee can be seen digging the instrument into what appears to […]
