Landlord Software Under Fire in Chicago Suburbs

The city of Evanston is weighing a potential ban on software platforms that use algorithms to influence or coordinate rental prices, as concerns grow over the impact these platforms could have on housing affordability.

Originally introduced a year ago, the proposed ordinance took center stage again last week during a meeting of the city’s Housing and Community Development Committee. Alderman Juan Geracaris said he plans to reintroduce the measure next month, following the start of the new city council term, Evanston Now reported.

The software in question includes products from RealPage, PriceLabs, Zillow Rental Manager and Yardi. They use algorithms to monitor market trends, competitor pricing and occupancy rates, allowing landlords to dynamically adjust rents to maximize profits.

Evanston would join a growing list of cities pushing back against algorithmic rent-setting. San Francisco became the first to ban the practice last year, followed by Philadelphia and, most recently, San Diego, which voted to prohibit the software last week.

Evanston officials say there is no direct evidence these tools are driving up rents locally, but city planning manager Liz Williams called it an “emerging policy issue.”

“It is a risk that could be realized just based on the knowledge of data coming in,” Williams said, noting that enforcement of any future ban would rely largely on tenant complaints and follow-up investigations.

RealPage and other landlord software providers are the focus of a federal antitrust lawsuit filed by the Justice Department. The Texas-based company continues to defend its pricing tools and has sued the City of Berkeley over a similar ban.

—Rachel Stone