The economic law of supply and demand dictates that if the supply of goods or services outpaces demand, prices fall. Most politicians understand this and commonly invoke that law in response to public discontent about high consumer costs.
When it comes to housing, however, leading Democrats are offering lip service to supply, while simultaneously engaging in counterproductive schemes to deflect responsibility for rising costs.
Instead of addressing the true sources of inflation and economic instability, the administration’s go-to response is to take cheap shots at the private sector.
Addressing the national housing shortage will require an estimated 1.7 million new homes each year, on average, until 2030. As its response to this crisis, the Biden-Harris administration has chosen a desperate, partisan approach by scapegoating private-sector technology through litigation.
The Department of Justice is suing rental industry software company RealPage Inc., alleging it played a role in raising rents for apartments and multifamily dwellings. Blaming a single data analytics company for the nationwide housing shortage and inflationary pressures may seem bizarre — and it is. We need real solutions.
What is RealPage? In addition to providing property management tools like IT support platforms and renter verification systems, RealPage offers assessments of rental asset metrics such as vacancy rates, leasing term trends, projected occupancy, and anticipated consumer demand.
Property managers need quick analysis to set prices appropriately within the market. Setting prices too low risks financial disaster by failing to capture fair market value in a market with razor-thin margins. Setting them too high, however, discourages consumers, leading to empty units and daily losses.
Without evidence from the Justice Department showing where rents have risen excessively, the claims of market power against RealPage appear dubious at best. Leasing companies with about 3 million units nationwide use RealPage’s market price assessment tools. If the government’s accusation held merit, it could point to plenty of examples to support the charge.
Unwarranted attacks on data analytics tools represent the latest effort by a Biden-Harris administration that frequently makes baseless claims of misconduct across industries struggling to survive under the challenging economic conditions this administration has created.
Last year, for example, the Justice Department sued to block JetBlue’s acquisition of Spirit Airlines. Biden-Harris central planners attempted to dictate travelers’ options while fostering an environment that stifles innovation and limits airlines’ ability to reduce fares.
In another troubling example, the Biden-Harris administration targeted the grocery sector. When Kroger sought to acquire Albertsons, the Federal Trade Commission quickly challenged the acquisition, citing unfounded competition concerns and potential price hikes. This stance ignores the steep price increases driven by administrative policies and unchecked government spending, which have cost taxpayers over $2 trillion.
Instead of addressing the true sources of inflation and economic instability, the administration’s go-to response is to take cheap shots at the private sector — companies that aim to innovate and create market efficiencies that benefit consumers.
Improving the housing market starts with lawmakers overhauling the nation’s notoriously burdensome construction codes and regulations. Rising material costs due to tariffs, lengthy permitting processes, construction workforce shortages, restrictive zoning laws, and environmental requirements all create cost pressures that discourage building the new housing America desperately needs.
Since returning to my native Arizona several years ago, I’ve seen firsthand the influx of people moving here, naturally driving up rents. Unfortunately, under our Democratic attorney general, state officials have joined the Biden-Harris administration in ignoring the real causes of rising market costs, previously filing their own lawsuit against RealPage. After 20 years of Republican leadership that made Arizona attractive to newcomers, Democratic leaders now regrettably pursue a misguided path that stifles innovation.
To address housing affordability, we must tackle supply shortages and inflationary pressures. Instead, the federal government under Biden and Harris has chosen to scapegoat a software company and mislead consumers about how the housing market works. Americans shouldn’t fall for such false narratives.
Housing prices, Rent, Justice department, Antitrust lawsuit, Realpage, Joe biden, Merrick garland, Jetblue, Kroger, Opinion & analysis