Apartment for rent sign in Pasadena (File Photo – Emmanuel Kraultez).
In a move to protect renters from the rising costs of housing, Senator Sasha Renée Pérez (D-Pasadena) has introduced legislation aimed at prohibiting the use of artificial intelligence (AI) algorithms in manipulating and unfairly increasing rents.
By John Boucher
The proposed bill, Senate Bill 52, known as the “End AI Rent Hikes Act,” seeks to combat the growing influence of AI in the rental market, which critics argue has contributed to inflated rental prices across the nation.
Senator Pérez’s initiative comes on the heels of a significant legal development in 2024, when the U.S. Department of Justice filed an antitrust lawsuit against a Texas-based property management software company. The lawsuit accused the company of collecting and exploiting landlords’ competitively sensitive information, a practice that allegedly led to inflated rents. The government’s action highlighted growing concerns about the impact of AI tools on housing affordability and market fairness.
SB 52 would take a proactive step by banning the use of AI-driven rent-setting algorithms, which some believe are fueling the housing crisis. In a report from the White House Council of Economic Advisers in 2024, the estimated cost of AI-driven rent-setting tools was staggering — with renters bearing the brunt of a $3.8 billion increase in rental costs in properties where these algorithms are utilized. Experts warn that the continued use of such tools could further exacerbate housing instability, especially for low- and middle-income renters.
Senator Pérez’s bill aims to address these concerns by ensuring that rental prices are not artificially inflated by algorithms designed to prioritize profit over fairness.
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