California AB 325: Pricing Algorithm Compliance for Multifamily Rent Setting
California AB 325 added rules for common pricing algorithms under the Cartwright Act. Learn what multifamily teams should review before using rent-pricing software.
The short answer
California AB 325 is enacted law. It added Business and Professions Code section 16729, which addresses a defined "common pricing algorithm" under the Cartwright Act. The statute makes it unlawful to use or distribute such an algorithm as part of a contract, combination, trust or conspiracy to restrain trade or commerce, and separately prohibits using or distributing one when a person coerces another person to adopt a recommended price or commercial term for the same or similar products or services in California.
For apartment operators, the practical lesson is not that every revenue-management or analytics tool is automatically unlawful. The statutory definition and the way a tool obtains competitor data, generates recommendations, influences decisions and is used among market participants matter. Treat procurement and configuration of rent-pricing software as an antitrust-compliance decision, not just a leasing-technology purchase.
What California means by a common pricing algorithm
AB 325 defines a common pricing algorithm as a methodology—including computer software or other technology—used by two or more persons that uses competitor data to recommend, align, stabilize, set or otherwise influence a price or commercial term. The law also says a commercial term can include level of service, availability and output.
That definition is narrower and more specific than the everyday phrase "AI pricing." A spreadsheet, forecasting model, property-management system or AI feature should not be labeled illegal merely because it uses automation. The legal review should identify whose data enters the system, whether competitors are involved, what the system recommends, and how the recommendation is adopted or enforced.
Why multifamily teams should review existing revenue-management workflows now
California DOJ's June 18, 2026 LivCor settlement resolved allegations that the property manager used RealPage revenue-management software to align rents using competitively sensitive information from competing landlords. The settlement, subject to court approval, requires LivCor to stop using revenue-management software that uses competitors' nonpublic pricing data to generate rent recommendations, refrain from sharing competitively sensitive pricing information with rivals, and establish an antitrust compliance and training program.
A settlement resolves allegations against specific parties and is not proof that every pricing platform or landlord has violated the law. It is, however, a concrete enforcement signal for California multifamily operators: vendor due diligence should examine data sources, competitor-data handling, recommendation logic, override/coercion features, information sharing and the organization's own decision process.
A practical due-diligence checklist before using a pricing tool
Document the tool's purpose and data flow before relying on a recommendation. Ask the vendor in writing whether the system ingests nonpublic competitor rents, concessions, occupancy, availability, renewal outcomes or other competitively sensitive data; whether customer data is pooled to generate recommendations for rivals; and whether the product includes controls that pressure users to accept recommendations.
Internally, map every external and internal data source; review recommendation, override and approval controls; prohibit unauthorized sharing of competitively sensitive information; train revenue-management and leasing staff on escalation rules; keep written vendor representations and configuration records; and re-review the system after material product or data-source changes. Preserve the contract, product documentation, configuration choices, training materials and legal review so the company can show how the system was evaluated rather than treating an algorithm as an unexplained black box.
Do not confuse antitrust review with ordinary rent-cap compliance
AB 325's pricing-algorithm rules do not replace California's Tenant Protection Act, local rent stabilization ordinances, emergency price-gouging rules, lease requirements or housing-program restrictions. A rent recommendation can be independently generated and still exceed a separate legal rent cap; conversely, staying below a rent cap does not answer whether a pricing workflow raises antitrust concerns.
For an actual rent change, run the jurisdiction and lawful-amount analysis separately, then document the notice and resident file. Max Rental Tools' rent calculator, rent-increase notice and tracking records can support that operational workflow, while AB 325 and current legal advice govern the antitrust question.
What leasing and property-management teams should record
If a rent or concession decision is made with software assistance, keep a defensible business record of the final decision inputs without collecting unnecessary sensitive data. Useful records can include current lawful rent, unit condition or features, verified property expenses, documented concessions, vacancy/turnover facts, the approved final price and who authorized it.
Do not create a resident-facing statement that falsely claims an algorithm "required" a price when management retained discretion, and do not use Max Rental Tools as a substitute for counsel on an antitrust investigation. The platform's role is to help organize rental-law, notice and resident-file workflows after the legal and business decision is made.
Common questions
Did California ban every algorithm used to set apartment rents?
No. AB 325 addresses a statutorily defined common pricing algorithm and specified anticompetitive conduct. Whether a particular tool or use is lawful depends on its data, functionality and conduct; do not label all automated pricing unlawful.
What is a common pricing algorithm under AB 325?
Business and Professions Code section 16729 defines it as a methodology, including software or other technology, used by two or more persons that uses competitor data to recommend, align, stabilize, set or otherwise influence a price or commercial term.
Why does the 2026 LivCor settlement matter to property managers?
California DOJ says the settlement restricts LivCor's use of software that uses competitors' nonpublic pricing data to generate rent recommendations and requires antitrust compliance measures. It is a specific enforcement action, not a finding that every pricing product is unlawful.
Does AB 325 replace California rent caps?
No. Antitrust compliance and landlord-tenant rent restrictions are separate. A property still needs to check the applicable state or local rent rules, notice timing and tenancy-specific requirements for any actual increase.
Official sources
California Legislative Information — AB 325, Chapter 338 (2025)California Department of Justice — LivCor algorithmic rent settlement (June 18, 2026)Continue your check
Use the state directory for current jurisdiction-specific rules, calculate the proposed increase, then prepare the appropriate rental document only after the legal-rule checks are complete.