JP Morgan wants to make tenant data accessible to all landlords

This series explores surveillance and its intersection with race and civil rights. made possible with support from the Ira A. Lipman Center at Columbia University.

On Monday, JP Morgan Chase announced that it was piloting a new platform called “Story”, an online property management system that allows landlords to manage their portfolio of properties, collect rents, select tenants and view market information, including sale prices and vacancy rates.

This has been touted by the banking giant as a way to modernize rent payments and make them “stress-free” for tenants. Sam Yen, a JP Morgan executive, told Motherboard that this platform is specifically designed to modernize rent payment by completely eliminating paper checks: are still made in paper checks. In discussions with residents, as we questioned them, they said, ‘That’s the only reason I have a checkbook.'”

While a platform like this could make it easier for tenants to pay rent, Story is actually a massive data platform that tenant organizers and privacy advocates say will make it worse. inequality between landlords and tenants and will further reinforce discrimination in housing.

“It’s one thing to just allow tenants to submit rent payments online, these types of platforms aren’t uncommon and that’s something the JP Morgan platform is supposed to help do. But these guys of platforms aim to provide insights to property management companies based on data analytics in a space where there is already an abundance of technologies that make decisions about who gets and keeps access to housing,” Ridhi Shetty, the policy advisor for the Center for Democracy and Technology’s Privacy and Data Project, told Motherboard.

According to a JP Morgan spokesperson, “Story was designed for multi-family owners and operators who operate on a smaller scale, where there aren’t many purpose-built solutions. Many of these businesses are manual and intensive. paper, with competing priorities and limited support. Story can help these operators optimize the way they run their business.” Story will give owners “access to valuable data and insights, including more than 1,500 pieces of curated and original content, and see a holistic, real-time view of their portfolio”.

Specifically, JP Morgan says it will help landlords use data to screen tenants and “analyze markets.” CNBC reported that this includes helping landlords”set rent levels. It’s not hard to imagine a landlord raising rent because JP Morgan data suggests their market can handle it.

“Do these analyzes take into account why someone missed a payment? For example, someone withheld rent because a landlord failed to make repairs or insure a dwelling habitable or has failed to comply with the landlord’s obligations under the existing lease,” Shetty said. “Will this type of information lead the landlord to make changes or improve their own practices to ensure that tenants in the future will be more likely to maintain regular payments because landlords are meeting their obligations? Alternatively, by using rent payment data, landlords can often penalize tenants without correcting the factors that led to these incidents in the first place. There is an imbalance between who is going to benefit from this type of information about data collection.”

According to the 2022 State of the Nation Housing Report set up by Harvard University’s Joint Center for Housing Studies, low-income households and households of color are struggling to pay rents by up to 42% this year. Along with soaring prices for gasoline, food and other basic necessities, insufficient housing supply and higher interest rates, many tenants have been left homeless. The Story tool and similar tools can drive up rental prices without considering why tenants may not be able to send rent payments on time, said Rene Moya, a tenant organizer from the Debt Collective at Motherboard.

“As we know, nationwide, the inability to pay rent is by far the number one reason tenants face eviction. Landlords know and abuse that all the time and automated tools, such that JP Morgan is trying to build and publish, are just one more weapon in the arsenal of landlords, to weaponize this inability and difficulty in paying rent that tenants face,” Moya says. think that kind of innovation, but innovation for landlords is just going to lead to even more instability in the lives of tenants, but a better return on investment for landlords.”

The information Story hopes to provide isn’t new to owners. ProPublica recently investigated a piece of software called RealPage’s YieldStar, which helps landlords price apartments in the United States. RealPage, whose clients include some of the nation’s largest property managers, has been criticized for integrating its clients’ internal rent data into its software, giving landlords an aggregated and anonymous view of what their nearby competitors are charging “. Its algorithm, ProPublica found, was driving up rents, and the company encouraged landlords to leave some apartments vacant in order to raise rents and be more profitable. These tools can therefore be used to prioritize landlord incomes, while exacerbating housing inaccessibility and inequality.

The problem with Story and similar tools is that the power to use them is solely in the hands of landlords, and the vast majority of the benefits go to the landlord as well (meanwhile, tenants get the vaguely marginal benefit of being able to pay his rent online).

“What all of these types of technologies do is bring a ton of clarity and transparency to landlords, but there’s nothing quite like it for tenants. Renters don’t have the kind of ability that landlords have to be able to see what the real state of the rental housing market is. They don’t even know who the true ultimate owners of the buildings they live in are,” Moya said.

In this sense, Story and similar tools are quasi-surveillance tools where tenants obtain a minimum of comfort while giving up a large amount of data that can ultimately be used against them or aggregated with other people’s data to harm tenants as a whole.

“If we could use very basic forms of technology to show who ultimately owns the buildings, what the nominal rents are in those buildings, whether there had been any code violations in the past, all those sorts of things would help tenants to determine for themselves if the building they potentially want to rent is good enough. More importantly, it would help if our municipal officials in different parts of the country could check in and see what kinds of abuses are happening at ground level in our buildings. But there’s no transparent, clear way for tenants to be able to report it or show it to city officials,” Moya said.

Another tool Story is providing landlords with is a tenant screening discount through TransUnion’s SmartMove, which Story says will allow landlords to “proactively manage risk.” SmartMove uses credit reports, criminal records and eviction history in its reports. This type of screening can be very detrimental to the black and Latino communities, which are overrepresented in the criminal justice system and more likely to be deported than other demographic groups. SmartMove also creates a “ResidentScore“, which is a score intended to predict the reliability of a prospective tenant.

Several cities have considering banning this type of algorithm; last year Washington D.C. introduced legislation it “would make it illegal for companies and organizations to use discriminatory algorithms to make decisions about key areas of life opportunity, including education, employment, housing, and public housing and services such as credit, health care and insurance”. Researchers from Dartmouth and Georgetown Law School, meanwhile, Noted that ResidentScore “can perpetuate inequality on the pitch”.

“The Department of Housing and Urban Development has cautioned against using arrest and eviction records, the former because an arrest is not necessarily indicative of a conviction or a reliable predictor criminal behavior, and deportation records can often result from nuisance calls. to law enforcement against people experiencing domestic violence,” Shetty said. “In these cases, using only the arrest record for eviction records without that context will penalize tenants and potential tenants without considering the factors that contributed to the development of this type of data. And that continued to translate into people being denied the opportunity to access housing because of their race, their disability and also their gender identity. All this data without knowing the context in which it was generated will lead to unfavorable decisions regarding current and potential tenants. »

The US Department of Housing and Urban Development has issued guidelines in 2016, which said it was against federal law to refuse to rent or renew a lease based on an individual’s criminal history. In August, a bill was introduced in New York this would restrict the owners’ ability to check applicants’ criminal backgrounds. If this bill passes, NYC would join a number of cities, including San Francisco and Chicago, in preventing landlords from checking candidates’ criminal records. However, history continues to list these reports as part of its offerings to owners.

“There are ways to harness technology to improve the lives of tenants,” Moya said. “Instead, what we’re seeing is technology being harnessed to automate inequities for renters, especially at a time when their cost of living is being squeezed by massive rent increases.”

This article is part of Monitoring status, made possible by a grant from the Ira A. Lipman Center for Journalism and Civil and Human Rights at Columbia University, in conjunction with Arnold Ventures. The series will explore the development, deployment and effects of surveillance and its intersection with race and civil rights.

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