DENVER — A lawsuit has been filed against Greystar, a prominent U.S. property management firm, by the Federal Trade Commission (FTC) alongside the state of Colorado, alleging that the company has deceived renters nationwide out of hundreds of millions through misleading advertising and undisclosed fees.
This legal action comes at a time when renters are feeling the strain of a challenging housing market in the U.S., as the Biden administration takes steps to address the issue. Last week, several major property managers and landlords, including Greystar, were accused of collaborating to maintain elevated rent prices in a significant lawsuit.
Rent prices have been steadily increasing for years, causing a financial burden on around 21 million households, or nearly half of all U.S. renters, who now pay more than one-third of their income on rent. This has led many individuals to make difficult choices, such as skipping medical appointments to afford utilities, returning items to grocery stores to cut costs, or seeking minor loans from friends.
According to the FTC, Greystar manages about 800,000 rental units throughout the nation. In a response to the allegations posted on its website, the company issued an unsigned statement claiming, “The FTC has opted for headline-grabbing litigation in the waning days of the current administration.” The statement further contends that the complaint is built on significant misrepresentations and flawed legal arguments.
The lawsuit specifically claims that Greystar failed to disclose various additional fees—like those for waste disposal or package delivery—on advertising sites such as Zillow, even while those platforms included sections where such fees could be listed.
Potential renters often discovered these fees only after submitting inquiry forms or navigating through small-print hyperlinks. In numerous instances, the FTC alleges that fees remained hidden until applicants had already paid the application fee, with additional charges buried within lease agreements that could extend to as many as 60 pages.
In its defense, Greystar asserted in their statement that, “No resident at a Greystar-managed community pays a fee they have not seen and agreed to in their lease.”
The bipartisan FTC commission voted unanimously to pursue this lawsuit, which accuses Greystar of breaching the FTC Act as well as the Colorado Consumer Protection Act, as stated in a press release from the agency.
Phil Weiser, the Colorado Attorney General, highlighted the implications for other corporate landlords, stating, “To the extent that other corporate landlords are not advertising their all-in pricing and are engaging in similar tactics, they are on notice that such conduct is illegal.”
