San Diego City Council President Sean Elo-Rivera is proposing a ban on software used by some landlords to set the price of housing.
The ban targets companies such as RealPage, which collects private data on rental housing and feeds it through an algorithm to help landlords charge the highest rent possible. The practice was uncovered in a ProPublica investigation in 2022.
In August the U.S. Department of Justice and eight state attorneys general sued RealPage, arguing the company's software violates federal antitrust laws. The lawsuit states the software is already used by some landlords in parts of San Diego.
Elo-Rivera said the federal lawsuit would take years to be resolved, and that San Diego should adopt its own local regulations in the meantime — as San Francisco did in September.
"Families are unnecessarily being priced out because corporations are replacing compassion with code," Elo-Rivera said at a press conference Wednesday morning. "Artificial intelligence? Sure, they may call it that. But let's call this what it really is: artificial inflation."
The council's Rules Committee voted 4-1 Wednesday to direct the City Attorney's Office to draft an ordinance that would go before the full City Council at a future date. Elo-Rivera said the ban would not target software that helps landlords manage their rental properties or developers determine whether a project is economically feasible.
The lone "no" vote came from Councilmember Raul Campillo, who expressed concerns that the ban would not survive legal challenges and that any local regulations could be preempted by state law.
Representatives of landlords and the building industry also opposed the measure, saying it had not been adequately vetted and that the primary driver of high housing costs is a lack of housing supply.
"There is no doubt emergent technologies are being used by a wide array of businesses," said Adrian Luna, legislative aide with the Building Industry Association of San Diego. "It's important that before the city moves forward with adopting regulations that impact the use of technology, … the city should fully understand that technology. We don't believe that has been provided."
Elo-Rivera said he agreed more home building is key to lowering costs, but that cracking down on software that increases housing costs is also worthwhile.
"I won't pretend like this law will solve the housing crisis by itself — it won't," Elo-Rivera said. "We need more housing to be built, especially for low- and middle-income San Diegans. But that does not mean that we shouldn't do all we can to lower housing costs every way that we can."
