Governor vetoes bill against rent-setting algorithms in Colorado

In Colorado, weeks prior to today, Governor Jared Polis made headlines by vetoing significant legislation aimed at banning the use of rent-setting algorithms by landlords. The bill, which had garnered support from the Democratic-controlled Legislature, sought to address rising housing costs attributed to such algorithms, which critics argue enable landlords to collude and coordinate rental prices unfavorably for consumers. Proponents of the bill, including various housing advocates, expressed deep disappointment, labeling the veto a blow to those struggling with high rents. Polis defended his decision by asserting that existing laws against collusion among landlords already address the issue. He emphasized that algorithms could serve to reduce market friction by helping efficiently manage residential real estate, thereby providing beneficial data for both landlords and renters. This decision followed a federal lawsuit that accuses RealPage, a real estate software company, of facilitating cooperative rental price increases through similar methods. RealPage welcomed the veto, asserting that such regulations would hamper a healthy rental market in Colorado. Meanwhile, local housing advocacy groups have raised concerns that continued use of these algorithms poses a significant threat to low-income tenants, accusing corporate landlords of leveraging secretive pricing techniques to maximize profits. The debate over rent-setting algorithms continues to unfold, exacerbated by similar legislative attempts in other states and cities across the nation, indicative of a growing call for regulation in the housing market as affordability issues persist.