Changing In-Tenancy Chargebacks Can Redefine Multifamily Management

• Charge it: Most multifamily managers bill for damages at move-out, but mid-lease chargebacks could better control costs.

• Costly vacancy: A Minneapolis mayoral hopeful wants to tax landlords for empty storefronts to fight retail blight and revive downtown.

• Blue horizon: Like RealPage, mortgage software firm Optimal Blue faces claims it enabled lender price coordination.

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Perspectives

Changing In-Tenancy Chargebacks Can Redefine Multifamily Management

Most property managers still wait until move-out to bill residents for damage or neglect, relying on security deposits to cover the costs. But with renters staying in place longer, that old system is starting to show cracks. By the time residents move out, years’ worth of small issues—from clogged drains to dented garage doors—can pile up, making turnover expensive and time-consuming. Property teams also lose the chance to document damage in real time, often missing opportunities to recoup costs or correct behavior before it becomes habit.

That’s why more property operators are turning to in-residence chargebacks, a process that bills residents for damage as it happens. This approach doesn’t just spread costs evenly across a lease—it changes the entire dynamic between tenants and management. When residents are held accountable for misuse in real time, they’re more likely to take better care of their homes. It also helps reduce unnecessary maintenance requests, as residents learn the difference between what’s their responsibility and what’s the landlord’s. That behavioral shift can have a measurable impact on net operating income by cutting waste and making maintenance teams more efficient.

Technology is making this proactive model easier to manage. New AI-driven maintenance tools can automatically log, validate, and communicate chargebacks based on local laws, helping property teams stay compliant while minimizing manual work. The shift away from the traditional security deposit mindset reflects a broader trend in property management—one where data, automation, and accountability work together to build smoother operations and more responsible tenancies.

Overheard

Minneapolis Eyes Vacancy Tax to Revive Empty Storefronts

The mayoral-candidate for Minneapolis, Omar Fateh, has proposed a commercial vacancy tax aimed at landlords of empty storefronts—an idea gaining traction as downtowns grapple with high vacancy rates and fading foot traffic. According to the report, Fateh’s plan would tax commercial spaces that remain unleased for long stretches, with the goal of pushing property owners to either activate units or make them available at more realistic leases.

This policy isn’t unique to Minneapolis. In San Francisco, a commercial vacancy tax already applies to ground-floor properties vacant for more than 182 days—with escalating rates based on how long the space stays empty. Meanwhile, in California, statewide legislation (SB 789) has been floated that would impose an annual tax of about $5 per square foot on broader commercial properties vacant for 182 days or more. Other cities such as Oakland and Washington, D.C. have longstanding vacancy-oriented taxes or fees on under-utilized properties.

From an urban-planning standpoint, this is a signal that municipalities are no longer merely cataloguing vacancies—they are ready to penalize them. For property owners, this means the calculus is shifting: holding a storefront empty in hopes of higher future rent may no longer be cost-free. Even with the growth of these vacancy taxes, the effectiveness of them remains mixed—San Francisco’s own tax has been criticized for compliance hurdles and modest impact on actual leasing. As more cities explore these tools, developers, landlords and lenders will need to factor in not just market-demand dynamics but also regulatory risk around empty commercial space.

Optimal Blue Faces RealPage Déjà Vu in Data-Sharing Lawsuit

Optimal Blue, a major mortgage technology firm, is facing an antitrust lawsuit accusing it of helping lenders share sensitive pricing data through its Competitive Data License tool. The plaintiffs claim that 26 mortgage lenders used the system to align pricing, making loans more expensive for consumers. In response, Optimal Blue said its technology “fosters competition” by improving transparency and efficiency for lenders. The company’s public defense signals it plans to fight the allegations—at least for now.

That stance sounds familiar to anyone who followed the RealPage case. The multifamily pricing platform initially vowed to defend its algorithms, arguing that data-driven rent setting benefited the market. But as lawsuits multiplied and public pressure mounted, dozens of RealPage’s clients quietly settled for over $140 million without admitting wrongdoing. The parallels are hard to ignore: both companies built tools meant to optimize pricing, yet both now face claims that optimization became coordination.

The deeper issue runs beyond these two firms. As more of real estate’s pricing power shifts into algorithmic models, regulators are scrutinizing how much shared data is too much. What once looked like market transparency now looks like coordination. Both RealPage and Optimal Blue thrived by helping clients navigate volatility, but their legal exposure shows how easily optimization can be seen as collusion. If history repeats, this case could end not in vindication but in another settlement—and another warning shot for the industry’s data-driven future.

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