News & Events
Colorado’s HB25-1004: Banning Algorithmic Rent-Setting Vetoed by Governor Polis
In May 2025, the Colorado legislature approved House Bill 25-1004 (“HB25-1004”), titled “No Pricing Coordination Between Landlords,” a groundbreaking piece of legislation aimed at prohibiting the use of certain algorithmic tools used by landlords to set rental prices. However, on May 29, 2025, Governor Jared Polis vetoed the bill, halting its enactment and preventing it from becoming law.
Despite broad support among Democratic lawmakers and housing advocates, the veto means that the proposed restrictions on algorithmic rent-setting will not take effect. The bill’s defeat marks a significant moment in the ongoing debate over how best to regulate technological practices that may contribute to rent inflation and decreased housing affordability.
HB25-1004 Overview
HB25-1004 would have prohibited landlords and their representatives from using algorithmic devices to set or recommend rental prices, occupancy levels, or other commercial terms for residential properties. Specifically, the bill targeted scenarios where:
- Two or more landlords use the same algorithmic tool for rent-setting purposes;
- The algorithm relies on similar data or analyses across these landlords; or
- Nonpublic competitor data is utilized in the algorithmic processes.
The legislation also sought to ban the sale or distribution of such algorithmic devices intended for coordinated rent-setting among multiple landlords. An exception was included for tools that provide public, free estimates based solely on publicly available data.
The bill’s passage reflected growing concerns over the impact of technology on housing affordability in Colorado. According to a 2023 White House study titled “The Cost of Anticompetitive Pricing Algorithms in Rental Housing,” algorithmic rent-setting tools contributed to increased rental prices nationwide, with Denver renters paying an estimated $136 more per month due to such practices – the second highest increase of any metro area in the country.
Background and Related Litigation
The legislative effort followed high-profile litigation surrounding the use of rent-setting software in Colorado. In August 2024, the State of Colorado, the U.S. Department of Justice, and several other states filed suit against RealPage Inc. and multiple institutional landlords, alleging violations of antitrust laws through the use of algorithmic software to coordinate rental pricing.
According to the complaint, RealPage Inc.’s software enabled landlords to share nonpublic rental data and align their pricing strategies, allegedly leading to inflated rents and reduced competition. In April 2025, Colorado reached a settlement with one of the institutional landlord defendants, which agreed to stop using RealPage Inc’s pricing tools and cooperate with the ongoing investigation. Attorney General Phil Weiser emphasized the harm these practices caused to renters across the state. The lawsuit is ongoing against the other defendants.
Enforcement Mechanisms (If Enacted)
Had HB25-1004 become law, it would have been enforced under the Colorado State Antitrust Act of 2023. Violations would have constituted illegal restraints of trade or commerce, subjecting offenders to:
- civil penalties of up to $1,000,000 per violation;
- criminal proceedings for egregious offenses;
- injunctive and equitable remedies; and/or
- civil lawsuits by harmed individuals, including potential treble damages.
Implications for Landlords and Property Managers
Although HB25-1004 was vetoed, the conversation surrounding algorithmic rent-setting will continue. Landlords and property managers in Colorado should remain aware of ongoing legal scrutiny and potential future legislative action. Key risk factors include:
- using shared algorithmic tools that could lead to coordinated pricing;
- utilizing nonpublic data sourced from competitors; and
- engaging in informal agreements or pricing practices that may raise antitrust concerns.
In addition, enforcement under existing state and federal antitrust laws remains a real possibility, particularly given the active investigations and pending litigation relating to rent-setting practices.
Conclusion
Governor Polis’s veto of HB25-1004 stalls, at least for now, Colorado’s attempt to formally regulate the use of algorithmic rent-setting tools. While the bill will not become law, its legislative journey underscores the state’s increasing focus on housing affordability and market fairness in the face of technological developments.
The issues raised by HB25-1004 remain relevant for the commercial real estate industry in Colorado. Landlords and property managers should closely monitor the ongoing litigation and policy developments and evaluate whether their pricing tools and practices could attract regulatory scrutiny. To learn more about HB25-1004 and ensure your rent-setting practices remain in compliance with current antitrust laws, please contact me or any other Otten Johnson professional.
