Moratorium on rental auction platforms moving forward

A couple of weeks ago I reported that the Council was considering placing a moratorium on rental auction platforms such as Rentberry and Biddwell. This morning, a bill to do just that was voted out of committee.

Invoking the specter of Uber’s quick rise to ubiquity, Council members Mosqueda and Juarez expressed their desire to understand what the implications of web-based rental auctions are before they get well established and the Council’s hands are tied.  This action was spurred on by the UW student government, which called on the City Council to ban rental auction platforms.  Data on the effect is scant, but the companies claim that they raise rents by about 5% in tight housing markets like Seattle, and lower them by about the same amount in markets where housing is more available (like most of the country outside of the major cities).

It seems likely that rental auction platforms are illegal under the terms of the city’s “First in Time” tenant protection ordinance that requires landlords to rent a unit to the first qualified prospective tenant who applies (though it gives landlords a lot of flexibility to decide the definition of “qualified” under the rental terms he or she publishes with the listing). However, that ordinance is currently being challenged in court.

The bill as introduced would place a one-year moratorium on rental bidding platforms while the Office of Civil Rights and the Department of Construction and Inspections conduct a study looking at the legality of the platforms and their impact on equitable access to rental housing in Seattle.

Council members Mosqueda and Juarez made two amendments to the bill today. The first one adds the Office of Housing to the departments required to conduct the study, and adds a requirement that the study be delivered to the Council one year after the ordinance is enacted. The second amendment gives the Council authority to extend the moratorium an additional year if more time is needed for the study or for the Council to review the study report and consider possible action.

The bill will go in front of the full Council for final approval on May 19th.