Seattle City Council Halts Online Rent Bidding Apps

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Seattle City Council Halts Online Rent Bidding Apps

The Seattle City Council in an 8-0 vote has put a moratorium on the use of rent bidding apps for rental housing in Seattle until the council can study the impact of the technology, according to a release.

Startups like Rentberry allow landlords to list rental units so that would-be tenants can offer higher or lower prices, based on what they would be willing to pay. The sites take a percentage of the difference. Operators of these rental auction sites claim supply and demand already affect rent prices and that their services just make the process more transparent, according to reports.

“Innovation in technology has been a key component of what makes Seattle such a great city, adding to our economic diversity. At the same time, we must have the opportunity to learn about new platforms, such as these ‘rent bidding’ platforms, and ensure that they live up to the equity and housing access values of our city,” Councilmember Teresa Mosqueda said in the release.

The Rentberry site says, “Rentberry is a transparent home rental service and a price negotiation platform uniting tenants and landlords. It automates all the standard rental tasks from submitting your personal information, credit reports and custom offers, to e-signing rental agreements and online rental payments.”

Rentberry lists a number of major cities, with the exception of Seattle, on its site including New York, Miami, Chicago, Los Angeles, Boston, Houston, Philadelphia, Phoenix and Atlanta.

Rent bidding apps will be studied

Mosqueda’s legislation puts a one-year moratorium on the technology’s operation in Seattle while the City’s Office of Housing, in conjunction with Office of Civil Rights and Department of Construction and Inspections, evaluates the potential impacts of the rent auctioning applications, specifically how they abide by equitable access to housing laws.

 During the moratorium, the city will evaluate how the bidding platforms comply with the city’s fair access housing laws, including the “First in Time” law, which requires that landlords accept the first qualified applicant.

 Mosqueda developed the legislation after the Associated Students of the University of Washington (ASUW) approached her with concerns about access and equity, and asked that the City evaluate the potential impacts of rent bidding apps, and compliance with city laws.

Sorana Nance, ASUW Senate Speaker, said in a release, “I’m glad that students have had an impact on the Seattle that we will be living in, especially at a time when our city is experiencing rapid change. My hope is that this legislation will help ensure equitable housing practices for Seattle residents now and in the future.”

Councilmember Mosqueda added, “I’m thankful to the ASUW students for approaching me, and appreciate Puget Sound Sage for illustrating the importance of pausing and evaluating the technology before we have unintended consequences.”

Rentberry said in a release that, “One of the revolutionary blockchain technologies the team is working on this year is the Rentberry Auctioning Technology. The Auctioning Technology’s core purpose is to ensure that landlords price their properties optimally in both hot and slow markets, while potential tenants are afforded complete visibility on competing offers and offered the ability to seamlessly negotiate rental terms online. It acts as a pricing oracle that allows tenants to bid, sign legal rental documents, and settle payments using BERRY tokens, all in one place,” according to investinblockchain.com.

Tenants can also crowdsource their rent deposits in the community.

Resources:

Seattle bans rent bidding in latest attempt to keep disruptive tech from compounding housing crisis

Seattle bans apartment auction apps to avoid online bidding wars

Why rent bidding apps will make the rental market even more unaffordable

Rentberry Roadmap: Will 2018 Be the Year of the Rental Market Revolution?

 

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