The Pacific Legal Foundation (PLF) has filed suit in federal court against the city of Seattle over a ban on the use of rent bidding sites. The suit was filed behalf of RentBerry, a San Francisco based rent bidding website, and Seattle landlord Delaney Wysingle. The suit challenges the ban on free speech grounds.
RentBerry launched their product in May, 2016. It provides a platform where landlords can list their properties for rent and tenants can bid on the rental. RentBerry says that their product brings transparency to the process of renting a place to live. It allows prospective renters to see the landlord’s asking price, to see how many other bidders are vying for the unit and what they have bid. The prospective renter can then submit his own bid. RentBerry provides applicant screening including credit scores and background checks and makes these available to the landlord along with the bid.
Landlords with three or fewer units can list their rentals for free on RentBerry’s site. Prospective renters can view listings for free but must pay a $9.99 fee to send a rental application to a landlord.
Just say no, for now
Opposition to the use of rent bidding sites started with students at the University of Washington who were concerned that their use would drive up rents in an already tight market. The Seattle city council passed a one year moratorium on their use in March by an 8 to 0 vote. The ordinance is intended to give the city time to determine if rent bidding sites comply with Seattle’s housing laws and what their impact may be on the local housing market. The ordinance includes a provision whereby the ban may be extended for an additional year if more time is required to complete the study.
The suit alleges that the moratorium censors the free speech rights of both RentBerry and of the users of their service. Attorney Ethan Blevins of the PLF said “Seattle should applaud innovators who are trying to solve a growing housing crisis. Instead, the city has banned websites that offer a solution without even giving them a chance.”