Submitted by JCwhatimsayin t3_z3jtbw in jerseycity
There was a recent post about the role these services might be playing in driving up rents in Jersey City. Now the DOJ is going to take a look!
ProPublica: The DOJ Has Opened an Investigation Into RealPage. https://www.propublica.org/article/yieldstar-realpage-rent-doj-investigation-antitrust
Bbbbbbut supply and demand!!!
collusion and monopoly have entered the chat, and settled into a nice Hudson county brownstone
The market is still the market. This dumb algorithm sets the maximum rent subject to supply and demand constraints. That's why they use the same software across the country and yet rents are cheaper there. You don't even need to look far away. Compare new buildings in Harrison to those downtown. The Harrison ones are not priced the same as downtown despite clearly using the same algorithm, why, because of supply and demand. Either way it's collusion. But it doesn't mean supply and demand suddenly doesn't exist.
So many people are willfully ignorant about basic economics. I’m sick of trying to explain it.
In every thread on this topic, it’s always the same people who refuse to acknowledge the facts no matter how many times people try to explain it.
Anyone who thinks that we need to do anything other than build more housing when there’s a housing shortage is engaging in wishful thinking.
It’s the left’s version of COVID denial. And it’s one of the defining social problems of our time.
That’s why San Francisco, which is supposedly one of the most “progressive” cities in the country, has a massive housing problem where even middle class people struggle to find adequate housing because they simply refuse to build enough new housing.
Now the same story is playing out in cities across the country. It’s not that developers and landlords have suddenly gotten greedier then they were a couple decades ago. It’s a problem of our own making.
You can downvote all you want and it won't change the fact that a brand new, collusion building in Harrison is cheaper than one in Jersey City and you have no economic model to explain that.
Are you talking at me? You do seem to have confused a pithy comment about the wealthy and powerful getting a blank check to do whatever they choose around here to great benefit & profit, with ignorance about ‘economic models’ or something.
Any outrage for the exclusionary suburbs, or will it only be for downtowns? If they were allowed to build nothing you make the owners of current buildings richer. Congratulations you get to choose who gets rich of 2 already rich groups. There is no point to blocking construction
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> and they have no control
This is a lie. Their company can choose to use any price they want. They CHOOSE to use this price. They have complete control. As usual, when a company says they "can't" do something because "it's policy", it's a lie. They can do whatever they want unless it's illegal.
u/Positive_Debate7048 You're not talking to a guy, you're talking to a company, and that dude is just their paid mouthpiece. The company can do whatever it wants. Including lie to you and tell you that they "can't" change the price. That is a lie. Unless it's illegal, they CAN change the price, but they simply don't want to.
If what you said was true, then a doctor's office couldn't function because when you call and talk to a receptionist, that person isn't a medical doctor and so they can't help with your medical problems.
A business is made up of lots of folks, and which representative it's CHOOSING to speak through is simply an internal detail that shouldn't matter to you. You are still speaking to the business.
Businesses lie about these things, because SUCKERS BELIEVE IT. And then they pay more money. And so OBVIOUSLY businesses will continue lying more and more and more, because lying MAKES MONEY.
Actually I think they meant the actual leasing office has no control because it’s corporate that is overruling them. It’s above the leasing office pay-grade to deviate from what the pricing model (that’s running from the corporate office) is telling them.
You're dealing with the corporation. If they send a representative to talk to you, that can't do anything, that's their own problem.
That's like complaining to your boss that you can't fill out this form, because you decided to grab a chopstick instead of a pencil.
Doesn't matter if the leasing office can or can't, they are simply a paid mouthpiece of the corporation, who absolutely can.
These lies are designed to make you stop asking questions and just pay more. And these lies WORK WELL. Because people believe them.
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They don't have control either.
The contracts behind the loans that the building was built with dictate how pricing is set. There's lots of fine print in those agreements to protect the investors.
A company can't just negate those contracts and set prices how they want. They agreed to run that building financially in very explicit terms before they broke ground.
What type of financing are you talking about?
If the representative of the company that you happen to be speaking to, doesn't have access to or control over something, that's not your problem, it's an internal detail of how the company runs itself.
People tend to view their interaction with "the person" in front of them. You're interacting with a corporation, and this person is their paid mouthpiece. And this corporation can do whatever it wants to.
"I can't because" and "because policy" are lies, designed to make you stop inquiring, and just pay more money right now. And, THEY WORK WELL. Because people forget what I just said above.
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I mean they do have a point, and the whole reason of this thread is that the DOJ is smelling a conspiracy to raise prices laundered through the wash of a third party consultant algorithm that everyone happens to use to set similar skyrocketing prices. But also yes haggling at fast food vibes
Your intuition is off this time.
The lies work because a lot of folks, probably including you, just believe them and immediately pay more money when they're spoken. Why wouldn't the company lie if they get more money?
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> Is the leasing agent who’s a chill guy and is evaluated on occupancy part of the grand conspiracy to min max you and lying to you blind when he could just give half off rent? No.
Here you go again talking about people.
I'm not going to lunch with this person after work. When they're working, they are a representative of the company, and I am talking to THE COMPANY. I am not talking to them as an individual, this is a business discussion. The COMPANY either will or won't do something, but it has nothing to do with THE MEATBAG that's delivering the news to me.
You seem too thick-skulled to comprehend this.
You intuition is off again, in thinking I don't understand where the collusion comes from.
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You strike me as someone who is only pretending to be dumb, and has a hidden agenda, aside from consumer protection.
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Well the guy in the leasing office may not have any control
I have no inside information, and I have only the faintest idea how this works, but this would be a defense you'd expect against allegations of collusion, no?
Not my fault, the machine did it!! Give me a break.
There are a couple Behind the Bastards episodes about this.
Had not heard of these folks. Looks like a fun podcast. Thanks for the tip!
The episodes predate the investigation, I believe.
BUT I thought if we built more luxury housing, the rents would go down! 🤯 And now you’re telling me that those wealthy enough to own a luxury apartment building aren’t noble participants in the holy logic of supply and demand?!
Well, I guess we all sorta naively thought the tenants were the customers. Turns out there's a separate market here in Jersey City where the tenants are the assets and the asset buyers are the customers. There's still a market out there where tenants are customers, and these price-fixed buildings may still be easing the pressure on the supply in THAT market.
That’s exactly how the ocean of empty real commercial real estate works, too. Lots of it is traded via ETFs and other more complex derivatives. It’s owned by holding companies that are traded as part of peoples retirement funds, or traded overseas as a hedge against a local economy, etc. “Supply and demand” is pretty far removed from real estate at this point.
This does not disprove supply and demand. The same software is used in Harrison yet prices are lower. This maximizes rents through collusion subject to supply and demand constraints. Take an economics class and you'll find out how that's possible.
Don’t forget to pick up your bowties at the dry cleaner!
This is what happens when you go too long without eating the rich.
All of these affordable housing schemes are too confusing. I am proposing a simple system where, if you, as a landlord, raise rents by more than 5% annually, you get dragged into the street and torn to shreds by feral dogs.
A good way to turn Jersey City into NYC. How well has rent control worked there?
Shouldn’t this apply to the BOE increasing property taxes by 35% plus in a year as well?
Landlord spotted!
Landlord?! Whereemote:free_emotes_pack:scream
If you ran for mayor on this platform it would probably give the voter turnout numbers a nice bump.
Wait till you see my policy proposals on blocking the box and hit and runs
shocked pikachu face
But... but... if you build more apartments then rent prices are guaranteed to go down! SuPpLy and DeMaNd (sarcasm).
I literally got into it with PhD level economics scholars explaining that supply and demand doesnt work when all new builds collude to set prices... and the prices are ALWAYS set to HIGH! But what do I know... I'm just an average joe who lives in the real world and has eyeballs.
Explain why rents are lower in new buildings in Harrison and across the country (all of which use this collusion software) without mentioning supply or demand.
We just need to build more luxury housing to fix the problems caused by building more luxury housing. Simple as.
Not saying it’s right, but it’s similar to airline and concert ticketing systems. Hell I saw a golf course out by Montclair that uses demand based tee time pricing
Yeah, these things occupy different tiers in our hierarchy of needs. But dynamic pricing is one thing. The fees go down when there's slack demand. Here the allegation is that the providers are setting minimums in a roundabout way. It would be like if the golf courses in the area all agreed to never charge less than $200.
> The fees go down when there’s slack demand. Here the allegation is that the providers are setting minimums in a roundabout way.
But luxury apartment rents did plummet during COVID. That’s a pretty clear example of the dynamic pricing models responding to a drop in demand.
Rents are up now because so many people are moving back to the city and inventory levels are low again.
At the end of the day, it’s the low vacancy rate that enables landlords to charge higher rents, not the pricing software alone.
For example, most large apartment complexes in Houston use dynamic pricing. But Houston has a relatively high rental vacancy rate because they build new housing left and right whenever there’s a surge in demand. As a result, apartments there are relatively affordable despite using the same software that landlords use here.
Psychological-Ad8175 t1_ixmdpj6 wrote
This is obvious on all large corp owned buildings what's a few empty units when you can keep prices skyrocketing.