SF startup lets would-be tenants bid for apartments

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http://www.sfgate.com/technology/ar...-to-auction-off-rental-apartments-7467415.php

Rentberry, an online price auction tool for long-term property rentals, aims to compete with Craigslist and other "Stone Age" rental services. "Essentially, we offer a more efficient and transparent application process which has the elements of bidding and an auction," said CEO Alex Lubinsky. As in an eBay auction, tenants would be able to see how many people are competing for the property and what the highest offer currently is. They can make multiple offers before the bidding ends, but landlords would not be compelled to accept the highest bid. For example, they might consider a higher-quality bidder with a lower offer more suitable. The service, which plans to launch Tuesday in the Bay Area and New York, offers free listings for landlords. Lubinsky said hundreds have already signed up. Rentberry intends to charge tenants a flat fee of $25 when the agreement is signed. After the business is established in six months or so, Rentberry may require landlords to make monthly payments of one quarter of the extra rental income that the service generated for them. Let's say a property that was listed for $2,000 a month was auctioned off for $2,075. The landlord would have to pay Rentberry 25 percent of the $75 difference ($18.75) every month for as long as the tenant keeps the apartment.
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Is this the future of renting? Dear God NO.
 
Honestly surprised that I've never straight-up bid for an apartment before. But anyway, it's not like this is some wild new thing. I've never moved into a place without negotiating the list price down a bit.
 
This seems like just about the last thing the San Francisco or New York housing markets could possibly need or want.
 
Tech just continues to hurt low income people. Imagine barely having enough to afford a place but you're outbid so now you can't afford to live in your area.
 
If there is no potential to get an apartment cheaper than expected there is zero reason for a person looking for a place to use this.
 
devilhawk said:
If there is no potential to get an apartment cheaper than expected there is zero reason for a person looking for a place to use this.
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True. At the end of the day, these apartments should sell for roughly market value. If they go for above market value, people will stop bidding for their apartments
 
charlequin said:
fuck these people
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Seems a bit harsh. One of the most frustrating things about renting in a tight market is going to countless viewings and getting turned down. In slower markets something like this could actually bring prices down, as vendors have a more accurate way of determining the market value of a property.
 
Yaboosh said:
But they don't have to live in the city.
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Bay Area housing price issues extend way, way beyond San Francisco. If you work in tech and want to work within 90 minutes of your office, you're going to deal with some seriously inflated prices.
 
I'd like to see the economic modeling of this. Doesn't in anyway seem like it will be a thing, renters don't want to pay over market rate, landlords won't list below market rate.
 
perfectchaos007 said:
Aren't the surrounding cities to SF getting pretty crowded too?
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Yes. They are expensive compared to the rest of the country but they aren't SF expensive. And there are pockets that are quite affordable. Keep in mind pay is often quite a bit higher around here to compensate.

Fact is living in the city at this point, for those who don't currently live there with rent control, is a luxury. The commute will often be unpleasant if you work there, but you stand to save thousands a month doing so.

Viewing living in a city as constrained as SF as a right just doesn't work.
 
I keep saying this in every thread but we desperately need technology to bring the price of housing down, yet there's very little that technology can actually do.

The real solution is super-fast mass transit, so that people can live further away from work, which would help redirect development to less developed areas and spread out the increase in value of houses away from major urban centers, effectively cooling it.

Looks like sadly if you leave it to the free market none of this will happen, it necessitates a concerted effort from a government with a long-term vision, nothing we'll see happen here in North America.

perfectchaos007 said:
True. At the end of the day, these apartments should sell for roughly market value. If they go for above market value, people will stop bidding for their apartments
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Haha, of course, there is no such thing as anything being overvalued in a free market, right.
 
fredrancour said:
the customers are the landlords. the renters are a product and i guess they expect people to be driven to it by desperation.
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To be clear, lots of people in the area already implicitly recognize that to rent (or purchase, for that matter) an apartment or house you often need to preemptively offer 10-30% over listed price or else be outbid by someone else who did, but formalizing it is going to drive that up even further.

Polari said:
Seems a bit harsh. One of the most frustrating things about renting in a tight market is going to countless viewings and getting turned down. In slower markets something like this could actually bring prices down, as vendors have a more accurate way of determining the market value of a property.
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Not too harsh at all. These guys are going to focus their effort in overinflated markets because under their business model they don't really get paid unless they bring prices up for the landlord.
 
Yaboosh said:
Yes. They are expensive compared to the rest of the country but they aren't SF expensive. And there are pockets that are quite affordable. Keep in mind pay is often quite a bit higher around here to compensate.

Fact is living in the city at this point, for those who don't currently live there with rent control, is a luxury. The commute will often be unpleasant if you work there, but you stand to save thousands a month doing so.

Viewing living in a city as constrained as SF as a right just doesn't work.
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On the other hand, expecting employees to commute 1.5+ hours to work also isn't really quite feasible.
 
Ether_Snake said:
I keep saying this in every thread but we desperately need technology to bring the price of housing down, yet there's very little that technology can actually do.

The real solution is super-fast mass transit, so that people can live further away from work, which would help redirect development to less developed areas and spread out the increase in value of houses away from major urban centers, effectively cooling it.

Looks like sadly if you leave it to the free market none of this will happen, it necessitates a concerted effort from a government with a long-term vision, nothing we'll see happen here in North America.



Haha, of course, there is no such thing as anything being overvalued in a free market, right.
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Technology isn't the issue, NIMBYism is.
 
CornBurrito said:
On the other hand, expecting employees to commute 1.5+ hours to work also isn't really quite feasible.
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I mean, the only way it becomes unfeasible is when you have trouble finding qualified applicants at the wages you're offering.

I say all this being a Bay Area resident who doesn't have a long commute because i work away from the high demand areas, so I don't have to worry about it like a lot of folks. But i also don't make SF/SV wages.
 
Hey guys, what if we took an already expensive, limited, and non-optional commodity, added very little value, encoraged bidding wars that make it more expensive and skimmed some of that extra money off the top?
 
Qblivion said:
But it shouldn't be a product. Housing should be a basic human right.
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But not in any given city or any given area. How do you choose who gets the basic human right when there is more people who want to live in an area than there are places to live?
 
This reminds me of my friend who used to make a dozen or so fake accounts and give long 1 star reviews for any apartment complex he lived at, hoping to drive their occupancy rate lower to avoid any rent increases.
 
What about doing it Uber style? Surge rent pricing! Want to keep living in your beach-house during the holidays? The rent just tripled!
 
outunderthestars said:
This reminds me of my friend who used to make a dozen or so fake accounts and give long 1 star reviews for any apartment complex he lived at, hoping to drive their occupancy rate lower to avoid any rent increases.
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Smart. But what if he told the complex management in advance that he was going to give them 1 star reviews and used it as leverage upfront. As long as he doesn't artificially lower reviews, he can keep his lower rate. There's a price for everything, and I would say avoiding a 1 star review is worth $100 off a months rent.

Conversely, this tactic could be seen as a "threat", so maybe its best if he does it the way he's doing it
 
For example, they might consider a higher-quality bidder with a lower offer more suitable.
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Because landlords being freely able to make implicit judgments on the "quality" of renters based on whatever criteria they want with no accountability always works out so well.

sc0la said:
Hey guys, what if we took an already expensive, limited, and non-optional commodity, added very little value, encoraged bidding wars that make it more expensive and skimmed some of that extra money off the top?
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This is what Silicon Valley calls disruption.
 
Alphahawk said:
I don't understand how this would benefit the consumer at all.
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Housing is very competitive in these markets. Sometimes you put in a rental application and your'e up against 40 other people, so you just get rejected and the landlord chooses someone else. Eventually you get to the point where you're like "goddamnit I just need to fucking move". In comes this service, where you can just bid an exhorbitant amount to get the place.
 
perfectchaos007 said:
Smart. But what if he told the complex management in advance that he was going to give them 1 star reviews and used it as leverage upfront. As long as he doesn't artificially lower reviews, he can keep his lower rate. There's a price for everything, and I would say avoiding a 1 star review is worth $100 off a months rent.

Conversely, this tactic could be seen as a "threat", so maybe its best if he does it the way he's doing it
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I think that would technically be extortion.
 
faceless007 said:
Because landlords being freely able to make implicit judgments on the "quality" of renters based on whatever criteria they want with no accountability always works out so well.
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Just bought a house in San Jose. I'm moving next month. So I tell my landlord, and he puts an ad on Craigslist. Now, the area I currently live in is VERY predominantly Chinese. Like, 80% or higher. And my landlord tells me "I've gotten about 10 calls so far, but only 3 of them seem like good tenants. I'd like to show the property to them." So I agree, and all 3 come over. All 3 were white. Makes you wonder why the other 7 "seemed like bad tenants"

OTOH, how *would* you enforce accountability for something like this?
 
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