San Diego Bans AI-Driven Rent-Setting Software in Landmark Vote

City Council’s 8-1 decision targets algorithmic pricing tools accused of inflating rents, with ongoing federal and state investigations into potential antitrust violations.

• The San Diego City Council voted 8-1 to ban the use, sale, and licensing of AI-driven rent-setting software, marking a significant regulatory move against alleged algorithmic price-fixing.
• Councilmember Sean Elo-Rivera led the initiative, citing the need to protect renters from artificially inflated housing costs and prioritizing people over corporate profits.
• The ordinance allows for tools using publicly available market data or complying with affordable housing guidelines but prohibits software advising rental rates based on proprietary algorithms.
• Federal and state investigations, including by the U.S. Department of Justice, are examining potential antitrust violations tied to rent-setting software, with RealPage’s YieldStar under scrutiny.
• RealPage, a Texas-based company, disputes the allegations and has filed a federal lawsuit challenging similar ordinances, claiming they infringe on free speech rights and misrepresent its software.

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