A federal judge blocked New York's ban on rent-setting software, calling it a "close call"

A federal judge in Manhattan has blocked New York from enforcing its ban on landlords using algorithmic software to set rents. US District Judge Valerie Caproni granted RealPage a preliminary injunction on September 29, finding the company "marginally" likely to show the law violates the First Amendment, Reuters reported.

The law, signed by Gov. Kathy Hochul last October, bars landlords and real estate professionals from setting rents based on recommendations from software that performs what the statute calls a coordinating function. New York had put the law on hold while the case played out. The injunction keeps the state from enforcing it while RealPage's challenge continues, and it doesn't settle whether the law is constitutional.

Caproni called the decision a close call. "Under the rubric of preventing price fixing, the statute prohibits normal commercial conduct just because it is facilitated by software," she wrote. One point that helped RealPage, according to MLex's account of the order, is that the provision covers rent-setting software without distinguishing between tools that use public data and those that use competitors' nonpublic data.

Attorney General Letitia James argued the law regulated conduct rather than protected speech, and a spokesperson declined to comment on the ruling. Brad Hoylman-Sigal, who sponsored the bill as a state senator and is now Manhattan borough president, said landlords using RealPage were "trying to constrict access to housing by price-fixing." RealPage spokesperson Patrick Mendoza called the decision "an important victory" for the industry.

RealPage, which is owned by the private equity firm Thoma Bravo, filed its suit two days after settling with the US Justice Department and agreeing to stop its software from using competitors' nonpublic data to generate price recommendations, Reuters reported.

What New York renters are paying

The fight is over a market where rent is still climbing. New York City's typical rent is $4,154 a month as of August 2026, up 5.1% from a year earlier and about twice the national pace of 2.6%, according to RentDataNow data built on the Zillow Observed Rent Index. A typical one-bedroom runs about $2,732 citywide.

Manhattan on its own runs far higher. The Corcoran Group put the average Manhattan rent at $6,655 a month in July, with one-bedrooms averaging $5,486, according to Reuters. Corcoran's number is an average of Manhattan rents, which expensive units pull up, while ours is a typical rent across all five boroughs, so the two aren't directly comparable. We broke down that gap in why Manhattan's average rent runs so far above the median.

Other places have moved against rent-setting software too, including New Jersey and San Francisco, and we looked at whether bans like these actually lower rent in our review of rent freezes, caps, and algorithm bans. In New York, the software fight runs alongside another court case: landlords are challenging the Rent Guidelines Board's June freeze on about 1 million rent-stabilized apartments, which we covered in the rent freeze lawsuit.

Sources

• Reuters (September 30, 2026), for the ruling, quotes, and Corcoran figures

• PYMNTS, citing MLex (September 30, 2026), for the ruling date and the provision at issue

• RentDataNow New York City rent data, anchored to the Zillow Observed Rent Index, August 2026