Imagine paying more for rent because an algorithm says so. That’s the reality for many Bay Area renters, but local governments are fighting back against tech companies that are allegedly fixing housing prices.

San Francisco made headlines last year by becoming the first city in the nation to ban rent-setting algorithms. The move came after evidence suggested software companies like RealPage were using confidential data to help landlords coordinate pricing, effectively keeping rental costs artificially high.

Berkeley followed suit but quickly faced a legal challenge from RealPage, who claimed the ban violated their First Amendment rights. With the city facing a massive budget deficit, they ultimately postponed their ordinance for a year, highlighting the complex battle between municipal regulation and corporate interests.

The fight isn’t just local. Kentucky’s Attorney General recently sued RealPage and nine landlords, alleging illegal business practices dating back to 2016. Meanwhile, the U.S. Department of Justice has its own antitrust lawsuit against the company.

California is taking broader action. State Senator Sasha Perez introduced SB 52, a bill that would ban rental pricing algorithms statewide. The legislation has already passed the Senate and is moving through the Assembly.

Tenant advocates argue these algorithms can increase initial rental costs by 10-20%, effectively undermining local rent control measures. As Leah Simon-Weisberg, a tenant lawyer, put it: “Technology is not inherently bad, but it needs to be regulated”.

For renters, this means hope might be on the horizon. These legal challenges could potentially disrupt a system that has long favored corporate interests over tenant affordability. The Bay Area continues to lead the charge in challenging tech-driven pricing strategies that impact everyday people’s lives.