Senator Warren Presses HUD Nominee on Rent Price-Fixing

As Scott Turner prepares to face the Senate Banking Committee for his confirmation hearing as head of the Department of Housing and Urban Development (HUD), questions surrounding rent price-fixing through computer algorithms and shell companies used in real estate transactions are expected to take center stage. According to Yahoo, Turner’s nomination has already sparked concern among some lawmakers, particularly Senator Elizabeth Warren (D-Mass.), who laid out her concerns in a detailed letter ahead of Thursday’s hearing.

Warren, the top Democrat on the Senate Banking Committee, sent a 13-page letter to Turner on Sunday, pressing him to address several critical issues related to housing policy. Among her top concerns is the use of price-setting algorithms by landlords to increase rents — a practice that is currently at the center of a major legal battle. According to Yahoo, the Department of Justice has accused RealPage Inc., a software company, of facilitating illegal rent price-fixing by helping landlords collude to set rental prices above market rates. RealPage has denied any wrongdoing and is contesting the charges in court.

Warren’s letter pointedly asked Turner to clarify his stance on this issue. “Price fixing and other forms of collusion are illegal under antitrust law. However, companies like RealPage are allegedly enabling landlords to collude to raise rents using price-setting algorithms and non-public data,” she wrote. Warren wants to know whether Turner, if confirmed, would take steps to address this growing concern in the housing market.

The case against RealPage has drawn significant attention, with housing advocates arguing that such practices contribute to skyrocketing rental prices across the country. According to Yahoo, the use of algorithmic tools to set rents has been criticized as a way for large landlords to sidestep competitive pressures and inflate housing costs for tenants. Turner is expected to face tough questions on how HUD would tackle this issue to ensure fairer housing practices.

Beyond rent prices, Warren also highlighted the importance of cracking down on illicit real estate investments made through shell companies. Per Reuters, the Corporate Transparency Act, passed in 2021, requires companies to disclose their true owners to the government in an effort to curb money laundering and other illicit financial activities. However, the law has faced opposition from some conservative groups and is currently the subject of a legal challenge after a Texas district court issued an injunction.

Warren’s letter asked Turner whether he would uphold the law’s beneficial ownership reporting requirements, which she described as critical to preventing foreign “hostile actors” from using U.S. real estate to conceal illicit funds. She cited comments from Rep. Byron Donalds (R-Fla.), who praised Turner’s commitment to monitoring foreign investment in the housing market.

Turner, a former NFL cornerback and Texas state legislator, has a background in economic development, having served as executive director of the White House Opportunity and Revitalization Council under the Trump administration. While his housing policy views remain largely unknown, his experience overseeing Opportunity Zones — designated areas aimed at spurring investment through tax breaks — is expected to be a focal point of the hearing.

According to Yahoo, the confirmation hearing will likely serve as a litmus test for Turner’s ability to navigate the complex challenges of the U.S. housing market, particularly as concerns mount over rising rents and the use of real estate for money laundering. Warren’s letter makes it clear that she expects Turner to come prepared to discuss these pressing issues in detail.

Source: Yahoo