AB 325 California Rental Pricing Algorithm Ban

What AB 325 Bans

AB 325 prohibits California residential landlords from using or contracting for the use of any algorithmic device or service that:

• Aggregates non-public rent, vacancy, lease-term, or other competitive rental data from multiple landlords or property managers, AND
• Uses that aggregated data to recommend or set rent prices, vacancy strategy, lease terms, or pricing concessions for a residential rental property

This is the California analog to the federal antitrust litigation against RealPage's YieldStar platform, which has been the subject of DOJ scrutiny since 2022. AB 325 codifies a per-se prohibition under California law, on top of any federal exposure.

The named target is RealPage, but AB 325 is platform-neutral — Yardi YieldStar, Anyone Home, AppFolio Smart Pricing, and any future entrant that ingests competitor data and outputs pricing recommendations is covered.

What's Still Allowed

AB 325 does not ban data-informed pricing generally — only the specific aggregation-of-competitors mechanism. Permitted activities:

• Pulling your own portfolio comp data to set pricing on a specific unit
• Using publicly available data like Zillow listings, RentCafe, Apartments.com, public MLS, etc.
• Using your property management platform's tools for marketing, leasing, accounting, etc. — only the algorithmic pricing recommendation is banned
• Manual market research (calling competitors, walking other properties, online listing review)
• BLS/Census/HUD data for macro market analysis

The line is the aggregation of non-public competitor rent data plus a pricing recommendation algorithm. Keep your data sources public and your decisions human, and you stay clear of AB 325.

Penalties for Violation

AB 325 creates both private and public enforcement:

• Tenant private right of action. A tenant whose rent was set via a banned algorithm can sue for a rent rollback to the pre-algorithm market rate, plus statutory damages and attorney's fees.
• Attorney General enforcement. The CA AG can pursue civil fines up to $10,000 per unit per violation.
• Class action exposure. A landlord using a banned algorithm across a large portfolio can face class-action litigation aggregating tenant claims.
• Federal antitrust overlap. Conduct violating AB 325 may also violate federal antitrust law, exposing the landlord to DOJ action and treble damages.

What This Means for Property Managers and Owners

If you currently subscribe to RealPage YieldStar, Yardi YieldStar (now branded as elsewhere), or any similar algorithmic pricing platform, take these steps before January 1, 2026:

1. Cancel the subscription or downgrade to a version that does not use competitor data
2. Document the date of cancellation for any future inquiry
3. Switch to public-data + portfolio-data pricing using sources like Zillow, RentCafe, your own portfolio history, and human judgment
4. Train any staff who set rents on the new permitted methodology
5. Update your property management software contracts to confirm no algorithmic rent recommendation is being used

NGC has never used algorithmic pricing platforms in the YieldStar mold and has no AB 325 exposure. Owners self-managing or using small-firm property managers should confirm their pricing methodology in writing.

Why This Law Was Passed

AB 325 responds to widespread concern that algorithmic rent-pricing platforms — by aggregating non-public rent data across competing landlords and recommending similar rents — were enabling tacit collusion that increased rents above competitive levels. The federal DOJ filed a major antitrust case against RealPage in 2024 making essentially the same argument under federal law.

The California legislature concluded that whether or not the federal antitrust case ultimately succeeded, the California rental market was meaningfully affected by these platforms (estimated 20-30% of California professionally-managed multifamily was using YieldStar or similar at peak adoption), and that a per-se ban under state law was the cleanest remedy.

AB 325 is one of the most aggressive state-level interventions in algorithmic-pricing software anywhere in the United States as of 2026.

Frequently Asked Questions