Following a tense debate Wednesday, Council President Elana Pirtle-Guiney moved the proposed ordinance, championed by Councilor Angelita Morillo, to a second reading.
The move revives a proposal that, as of this spring, had been shaping into the City Council’s first major policy enactment before Morillo abruptly pulled it from consideration.
At the time, she pointed to ongoing litigation outside of Portland but related to the algorithms. The councilor appeared to be referring to real estate firm RealPage’s lawsuit against Berkeley, California, which has attempted to stop landlords from using its software to set rents.
Subscribing to real estate data services like RealPage has become increasingly common among landlords. Critics say the practice amounts to collusion that drives up rents for tenants as landlords effectively work in concert with one another. Landlord lobbyists say property managers use the software to understand the market and establish competitive rents.
In the months it’s taken for the proposed ban to reemerge, the City Council has still yet to pass a major policy proposal, as councilors have become more occupied with disputes over rules and procedure than passing new ordinances.
Morillo alluded to that inertia Wednesday.
“We need to get a substantive policy passed out of this council sometime soon,” she said.
To the 12-member council, the core issue with the proposed ban is whether it will deter developers from building new housing in Portland.
Councilor Dan Ryan, in particular, expressed skepticism that the ban would help with Portland’s high rents, suggesting it would only worsen the city’s reputation as an underperforming real estate market.
In a newly released survey by the Urban Land Institute and PwC, real estate professionals ranked Portland 80th of 81 markets in terms of investment potential. It was the Rose City’s second year at the bottom of the widely-circulated rankings, with only Hartford, Connecticut faring worse. Portland had better prospects in homebuilding potential, ranking 30th among U.S. cities, unchanged from the prior year.
Ryan called the proposed rent-algorithm ban “a solution in search of a problem.”
Morillo said she didn’t view her proposed policy and the development of new housing as mutually exclusive. She noted that the council voted in July for a three-year waiver on development fees to incentivize homebuilders and kick start production again.
“The reality is that we have done our part,” Morillo said. “This is about corporate power.”
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