A Start-Up That Lets Renters Bid Against Each Other for Apartments Just Launched in America’s Two Most Expensive Cities
There may be a venture-capital slowdown in Silicon Valley, but rental prices in the Bay Area are just as obscene as ever. If anything, you might be paying more for your San Francisco studio soon, thanks to a new start-up that wants to bring eBay’s competitive bidding model to the already cutthroat rental market. Rentberry, which just launched in New York and San Francisco, lets landlords list their rental units for free, while potential tenants can bid on properties and make competing offers as the price inches up. “Essentially, we offer a more efficient and transparent application process which has the elements of bidding and an auction,” C.E.O. Alex Lubinsky told the San Francisco Chronicle. Lubinsky said hundreds of landlords signed up, pre-launch.
Lubinsky denied that Rentberry, which competes with Craigslist and other services people use to secure rentals, creates a one-sided bidding war that’s bad for tenants. He said Rentberry adds transparency to a process that usually consists of tenants overpaying and making blind bids on living spaces. Rentberry users, too, don’t pay anything unless they are getting the apartment—no application and credit-check fees before you even know if you’re qualified for an apartment.
The highest bidder doesn’t necessarily win the apartment, Lubinsky said. Landlords aren’t forced to accept the highest bid; they can pick a lower bidder if there’s a more suitable tenant. But it’s hard to see how this kind of situation stands to benefit anyone but landlords and Rentberry, which charges a $25 flat fee when apartment bidders sign their lease and will eventually look to charge landlords 25 percent of any extra monthly income above the original listing price. But Lubinsky defended what, to some, appears to be capitalizing on a housing crisis affecting people in two of the most expensive housing markets in the country. “Here we have supply and demand, and we have freedom of choice. If people are willing to pay a certain amount, why should the landlord not get that price? We want to make sure everyone gets the fair market price,” he told Curbed.
Source: vanityfair.com
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