City Council on Monday took aim at two kinds of technology it thinks has caused upward pressure on rent, one being short-term rental platforms, the other pricing algorithms used by large residential property owners. The council accepted a new ordinance petition intended to crack down on unregistered short-term rentals advertised on booking companies like AirBnb and VRBO. If approved, city law would require the booking companies themselves to register with the city of Cambridge and administer financial penalties if they connect a user with an unregistered unit.
Owners of short-term rental units have been required to register their properties with the city since it passed a Short-Term Rental Zoning Ordinance in 2017. But the Department of Inspectional Services estimates less than a third of all short-term rentals are in compliance. Currently, 216 are registered while another estimated 500 are operating illegally in the city.
This new policy comes during a period of friction between rental companies and municipalities, which see the companies as depleting housing stock that could be purchased or rented. Cities like New York and San Francisco have put strict laws governing short-term rentals in place in an effort to combat their housing shortages.
“The broad goal of this is to try to make sure that housing is used as a place for residents to live in year-round,” said Councillor Jivan Sobrinho-Wheeler, who worked with Councillor Patty Nolan to develop the new ordinance language.
“There are exceptions if you have an extra room in your house that you have to let out. But if there’s a whole other unit, that should be housing, and visitors for the most part should stay in hotels.”
According to the new ordinance language, booking companies that earn fees from listing unregistered rentals could face a fine of $300 per day per violation. It also limits the length of stay in short term rentals to 90 days.
The petition was unanimously passed to a second reading with the Ordinance Committee.
Algorithmic price fixing
City council also unanimously passed a policy order initiating steps to ban residential property management companies from contracting companies that use algorithmic and AI-driven models to recommend what they should charge for rent. Councillors say that by using these services, managers are able to collude with one another through a third party in order to inflate rents in what amounts to illegal price fixing.
“Price fixing is a practice as a practice has been illegal for a long time due to antitrust laws that go back decades,” said Sobrinho-Wheeler, the policy order’s lead sponsor. “Corporate management companies for rental units by using algorithmic price fixing software to turn over their rental data to a third party and say, ‘Hey, we’re not talking to each other. We’re just talking to this third company and sharing with them all of our data, and then that company is telling us how to price our units, and coincidentally pricing them quite high.’”
Sobrinho-Wheeler confirmed that this type of software is actively being used by property managers in Cambridge.
This policy order comes four years after a report published by ProPublica revealed that in some areas of the country, users of YieldStar from the company RealPage increased rents by far more than comparable units. Under President Biden, the U.S. Department of Justice pursued an antitrust case against the company, which was settled in late 2025 under the Trump administration. The company agreed to remove nonpublic, competitively sensitive information from its model but admitted no wrongdoing and paid no financial penalty.
“If federal law was being enforced properly, this could already be banned nationwide,” Sobrinho-Wheeler said. “The reason that it hasn’t is because antitrust law has been really gutted at the federal level by President Trump.”
Cambridge joins cities like Berkeley, Calif. and Providence, R.I., that are trying to take matters into their own hands by enacting bans. Bills banning the practice in the rental market are also working their way through the Massachusetts state House and Senate.
The policy order directs the city manager work with relevant city departments to draft policy options or ordinance language that will be presented back to council later this term.
A stronger
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