WILMINGTON — Over a dozen senators sent a letter to the Department of Defense requesting an investigation into the cause of rising rental rates for service member families. The senators emphasized an ongoing national lawsuit against software firm RealPage and its contribution to spiked rents in areas including the Port City.
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Fifteen members of the Senate Committee on Banking, Housing, and Urban Affairs sent a Jan. 29 letter to Secretary of Defense Pete Hegseth to ensure landlords are not inappropriately profiting from service members’ use of the Basic Allowance for Housing. The Department of Defense spent $24 billion on BAH in 2023 to help military families pay for housing costs.
“The Department of Defense has a responsibility to protect military families from predatory private housing companies and ensure that taxpayer dollars meant for military families are not being pocketed by unscrupulous landlords,” the letter indicated. “We seek information that DOD may have on whether algorithms such as those used by RealPage are artificially driving up housing prices for military families, as well as members of the community who do not receive BAH.”
The Senate letter noted the Department of Defense increased its housing allowance for 28 military housing areas in 2022 in cities with recent cost increases higher than 20 percent; New Hanover County’s fair market rent for a two bedroom apartment raised 51% according to a January 2024 North Carolina Housing Coalition report, between 2018 and 2023.
In August, Gov. Josh Stein announced North Carolina’s participation in the national antitrust suit against RealPage alleging it illegally and artificially raised rents by sharing its clients’ confidential information — such as nonpublic rental rates, changes in competitors’ occupancy and rates, and future apartment availability — in its daily pricing algorithm.
The fifteen Democratic senators, including committee ranking member Sen. Elizabeth Warren, noted the 28 areas given increased housing allowance funding include cities named in the RealPage lawsuit. Stein and other attorneys general noted RealPage tracks rental housing units that use its revenue management products in multiple North Carolina markets.
In April, RealPage cited Wilmington as the fastest growing renter household market in the nation. The firm found, after 25 months of rent increases above national norms, that Wilmington had one of the “best showings nationwide” for its 2022 rental rate hike of 12.4% — nearly twice the national average.
The senators cited a 2022 Old Dominion University study finding real estate and leasing professionals use BAH information in setting rents, as well as an October Government Office of Accountability analysis finding an association between counties with higher military populations and higher rent-to-income ratios and median rents. A 2023 Blue Star Families Military Family Lifestyle Survey found housing costs to be the top source of financial stress for active-duty family respondents.
RealPage announced its Automated Basic Allowance for Housing Rate Management program in 2010 as part of its Military Property Management system.
“This innovation eliminates the need for privatized military housing site staff to manually retrieve data from government web sites each year and cull through the data for rates that apply to their projects,” RealPage’s military housing director wrote in 2010. “RealPage automatically retrieves the annual BAH rate tables and updates the entire system with the current valid rates.”
RealPage Senior Vice President Jennifer Bowcock maintained nothing about Basic Allowance for Housing data is ever used in the company’s rent pricing recommendations. She attributed high housing costs to the national undersupply of housing rather than market manipulation.
“The goal of this irresponsible letter from Senator Warren and some of her Democratic colleagues is to blame today’s housing affordability crisis on the private sector, rather than the failed policies of the Biden Administration,” she told Port City Daily. “Military families are invoked in this inquiry to impassion those who care about our men and women in uniform.”
Port City Daily asked the Department of Defense if it had a response to the senators’ letter requesting an investigation. An official responded by sending the DOD’s December press release of its 2025 Basic Allowance for Housing rates, which increased by an average of 5.4% in January this year.
Attorney General Jeff Jackson announced an amended complaint last month naming six of the country’s largest property management companies as co-conspirators for coordinating with each other and RealPage to raise rents. They include Greystar Real Estate Partners, Blackstone’s LivCor, Camden Property Trust, Cushman & Wakefield and Pinnacle Property Management Services, Willow Bridge Property Company, and Cortland Management. Greystar and Willow Bridge cumulatively manage thousands of Wilmington units.
“RealPage is creating an unlevel playing field,” Wilmington council member and veteran Salette Andrews told Port City Daily Thursday. “We talk about affordable housing initiatives as if we have a pure market but we don’t, because of things like RealPage.”
Port City Daily reached out to the county and state veteran affairs departments to ask how many service member families in Wilmington use BAH, if they have received complaints or concerns from military families regarding recent rental price increases in Wilmington, and if they know if service member families using BAH are staying in any of the Wilmington properties managed by companies using RealPage software. A county spokesperson said it tapped the veteran affairs department about the inquiry; this article will be updated upon response.
Wilmington-based Sweyer Property Management works with a large amount of military families to assist them in finding off-base housing. Port City Daily asked the company its views on the Senate letter and if it uses RealPage software; a representative said SPM had no comment.
Bowcock said the Department of Justice closed its criminal probe of the company although the civil lawsuit remains underway:
“If asked, we will meet with Secretary Hegseth and discuss how our products work and the lawfare campaign that Senator Warren and her colleagues continue to pursue against a U.S. company that provides products and services that benefit residents, housing providers and the rental housing ecosystem as a whole.”
Stephen Feinberg, Trump’s nominee to serve as Deputy Secretary of Defense, is the billionaire co-founder and CEO of Cerberus Capital Management. Cerberus owns Firstkey Homes, a company that uses RealPage property management tools and has drawn controversy for high eviction rates. Cerberus’ portfolio includes two defense contractors, which have paid millions in settlements to the Department of Defense for price-gouging.
According to Hegseth’s January financial disclosure, his spouse invests up to $50,000 in Blackstone. Blackstone owns multifamily asset management company LivCor, one of six companies included in the national antitrust lawsuit.
Hegseth’s spouse holds significant stock in major investors and partners of firms named in RealPage price-fixing lawsuits, including up to $50,000 each in KKR & Co. Inc, JP Morgan Chase, and PNC Financial Services Inc., owner of PNC Bank.
“We highly value RealPage’s data because it provides details on rent rolls such as lease renewals and true revenues that simply isn’t available anywhere else,” PNC Bank Vice Pesident Aimee LaMontagne Baumiller said in a RealPage testimonial.
Tips or comments? Email journalist Peter Castagno at peter@localdailymedia.com.
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