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Seattle set to ban rental bidding platforms… again

It’s been more than a year since Seattle put in place a one year ban on rental bidding platforms so it could better study the impacts from startups like Rentberry. Monday, the Seattle City Council is set to extend the ban another year to give City Hall more time to study the impact of the services.

The full City Council is expected to approve CB 119507 to establish yet another “one-year prohibition on use of rental housing bidding platforms.”

UPDATE: The move follows recent court victories that favor the city’s argument. In one, a judge upheld the first ban instituted by the council in spring of 2018 over concerns the bidding platforms that create “transparent” rental auctions where potential tenants have “the ability to submit custom offers” were being used to jack up rents in the University District. In another, a 9th Circuit Court of Appeals  set important precedent that bidding platforms don’t fall under First Amendment protections. (We’ve updated details of the legal decisions for clarity.)

Last year, CHS reported on the few Capitol Hill properties utilizing the services and the concerns raised about the practice in the Bay Area real estate market. One report on the Rentberry service quoted the company’s founder taking credit for raising rents 5% above listing prices in the already ultra-expensive San Francisco and San Jose markets.

The industry and Rentberry haven’t given up and are planning to challenge the 9th Circuit decision.

“As matters stand now, it seems the city has done nothing to ‘study’ the effects of rent-bidding during the year-long ban,” an attorney for Pacific Legal Foundation writes about the situation with its client. “That means the city council is likely to extend the ban, with no promise that they’ll actually do the investigation that justified the ban in the first place.”

“If they do extend it, we won’t bow to the court decision denying Rentberry the chance to challenge Seattle’s unconstitutional actions.”

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