AdobeStock
The Seattle City Council on Tuesday unanimously approved a bill banning algorithmic rent-setting tools that some claim have helped set higher rents in the city.
Council Bill 121000 bans software that analyzes market data to recommend rent levels, occupancy targets, or lease terms, which are tools often used by corporate landlords. It also creates a penalty of up to $7,500 per violation committed by a landlord.
According to Seattle City Councilmember Cathy Moore, the sponsor of the bill, there has been an increase in corporate landlords using new software that enables anti-competitive collusion and price setting to set higher rent floors in the last few years.
Property management software company RealPage is in the midst of an April lawsuit by Washington Attorney General Nick Brown. Brown’s office alleges "that RealPage and its software are central to a conspiracy and unfair competition by certain landlords that resulted in rapidly rising rent prices for their tenants."
The Seattle City Council approved the bill with one abstention from Maritza Rivera, who is a landlord. Fellow Councilmember Robert Kettle said that the bill supports the city’s core value of establishing a “level playing field” for both tenants and landlords.
“As we move forward with technology and especially in the advent of AI, it is important to make a statement that our principles are upheld even in the areas potentially cloaked or hidden by technology,” Kettle said during Tuesday's city council meeting.
The city council delayed the June 17 vote on the bill until Tuesday to allow more time for public review. Moore opposed the delay, arguing the bill, similar to proposed Senate Bill 5469 in the state Legislature, was already optimal. At Tuesday's meeting, Moore conceded the delay was the right choice.
“We were able to address some of the concerns that weren’t actually addressed in the Senate bill,” Moore said. “At the end of the day we have a very strong bill that we should all be proud of.”
Concerns raised by public commenters included the bill’s impact on short-term rentals and hotels, which was addressed by an approved amendment that explicitly excludes short-term rentals or hotels.
The bill now goes to Seattle Mayor Bruce Harrell’s office for his signature. It becomes effective 30 days after he signs it into law.