FTC targets rental software companies in new warning letter
The companies’ technology may be blocking property managers and owners from accurately marketing home rental prices, the agency said.
The federal government is stepping up efforts to go after software companies whose technology may obscure accurate prices on rental listings.
The Federal Trade Commission (FTC) announced on Dec. 9 that it sent letters warning 13 property management software providers that they may be violating the law if their technology prevents rental property managers from displaying all pricing information.
What the FTC said: In some situations, property owners and managers are unable to include all mandatory fees in the price advertised on listing websites because of the software they're using, the FTC suggested.
"We are monitoring the marketplace for potentially deceptive or unfair acts or practices relating to the marketing and advertising of rental housing and will take additional action as warranted," warned the agency's letter, which was signed by Christopher Mufarrige, the director of the FTC's Bureau of Consumer Protection.
The letter itself "is not intended to suggest that you have engaged in illegal conduct," Mufarrige noted. However, it urged the companies to "conduct a comprehensive review of your practices" to ensure legal compliance.
In a news release, Mufarrige said that the FTC "is committed to rooting out anticompetitive, unfair, and deceptive acts or practices in the rental housing market."
"Companies need to compete on price and consumers need accurate and non-deceptive information to make the best-informed decisions possible," he added.
Who received the warnings? Since the FTC did not publicly name the 13 letter recipients, it's unclear which companies the agency has flagged for potential legal violations. Real Estate News has filed a Freedom of Information Act request to obtain the list.
Stepped-up actions: The federal government has been busy taking action against property management companies and software providers on issues related to home rental pricing in recent months. Other disputes in the past year include:
The FTC announced on Dec. 2 that Greystar, the largest multifamily rental property manager in the U.S., agreed to pay $23 million to the FTC and $1 million to Colorado for allegedly deceiving consumers about rental prices.
RealPage and the Department of Justice reached a settlement last month in an antitrust lawsuit over the use of the company's multifamily rental housing market software.
Invitation Homes, one of the nation's largest single-family home landlords, agreed last year to pay the FTC $48 million to settle issues relating to "junk fees," poor housing conditions and illegal evictions.