(NewsNation) —The U.S. Department of Justice now says it’s close to cracking a massive criminal conspiracy on rent prices.
Officials say landlords worked together using the property management software RealPage to collude and raise rent prices at the same time by similar amounts, said Lance Lambert, co-founder and editor-in-chief of housing market analytics company ResiClub.
“But if you zoom out, the truth is that across housing — and it’s not just rents, it’s also home prices, which are up 47% since the onset of the pandemic — is that we’ve seen a deterioration in housing affordability,” Lambert said Wednesday on “NewsNation Now.”
Recently, the FBI conducted a search of the cooperate offices of Atlanta based rental property company Cortland Management as part of this price-fixing probe.
Rent prices have risen 30% nationwide in the past four years, nearing an average of $2,000 per month in March. That average was $1,639 in 2021, and $1,594 in February 2020, according to Rent.com
“Maybe some of the practices here are illegal and they’re going to get taken out of the market, but big picture, what fundamentally pushed up housing prices and rents is much bigger than any potential collusion in the market,” Lambert said.
Pandemic economics also created an accelerated demand for housing space, compounded by inflationary shock, he added.
“It’s not just rents,” he said. “It’s home prices. It’s home repairs. It’s the whole housing sector really just in a squeeze.”
While most millennial homeowners were able to secure their mortgages before rates jumped to 7%, Gen Z hasn’t been as fortunate, Lambert said.
“A lot of these younger Gen Z-ers are having a tough time getting into the purchasing market because of the home prices, because of the run-up in mortgage rates and incomes just haven’t kept up with it,” he said.