The U.S. Department of Justice sued a software company and six major property management companies, including one with properties in West Campus, on Jan. 7 for colluding to fix rent prices.
The lawsuit claims six property management companies colluded to raise rent prices across the country using a software called RealPage. One of those companies is Greystar Real Estate Partners, which owns Hilltop, Union on 24th and Union on San Antonio in West Campus.
Combined, the six landlords in question — Greystar Real Estate Partners LLC; LivCor LLC; Camden Property Trust; Cushman & Wakefield Inc. and Pinnacle Property Management Services; Willow Bridge Property Company LLC; and Cortland Management LLC — own at least 52,715 rental homes in the Austin area, according to KUT.
The lawsuit identifies downtown Austin, specifically the University area, and North Austin as submarkets where rent-fixing has “harmed, or (is) likely to harm” renters by reducing market competition in violation of federal antitrust laws. As a result, rents are higher than what they would be if landlords competed fairly.
According to the amended complaint, RealPage hosts monthly “user group meetings” where competing landlords discuss “competitively sensitive information” like profit margins and pricing strategies. RealPage’s software then recommends prices to keep rents as high as possible, according to the lawsuit.
Greystar denied any “anti-competitive practices” and said it operates with “utmost integrity” in a Jan. 7 statement. The Department of Justice did not respond to a request for comment.
Social work sophomore Kaithlyn Rivera pays $1,875 every month for a studio apartment at Greystar-owned Union on San Antonio. At one point, she was two months behind on rent and had to work out a payment plan with the leasing office until her financial aid funds became available.
“I was already outraged by the rent crisis (and) having to go through a payment plan, which for a college student is really hard (because) I have to take classes and have a job,” Rivera said. “(The lawsuit) was eye-opening, and now it’s something that I do want to keep up with.”
Psychology sophomore Rachel Shupps pays $1,095 in rent for a four-bedroom apartment at Union on San Antonio. She said she took advantage of a promotion to get lower rent but still works a part-time job and takes out student loans to afford rent.
Shupps said her unit did not have any hot water for the entirety of winter break, and it took weeks to resolve the issue because of a lack of communication with apartment management.
“I shouldn’t be paying this much to not have serious issues resolved that quickly or for the front office or management to (not) reach out to us and communicate properly,” Shupps said.
Shupps said while the lawsuit was unfortunate, she was not surprised to hear about it because of the struggles that come with leasing an apartment in West Campus as a student.
“The landlords and whoever works for these apartments will do anything to get students to live there,” Shupps said. “They know that we’re all young kids who aren’t experienced in taking out loans (and) who aren’t experienced living alone in a big city in an apartment for the first time, so they definitely use that to their advantage.”
