Meet James M. Nelson

An Expert on the Housing Industry and Economics

James M. Nelson

…has nearly 40 years’ banking experience, including work as a Federal Banking Regulator, agricultural and commercial lending, and ultimately owning his own banking services company. With nearly as much real estate experience, Nelson’s work as a licensed commercial broker has included many multifamily projects.

about the books

The book The New Landlord Powered by Big Data and Artificial Intelligence is an exposé on the rental housing industry. It details how they implemented artificial intelligent-driven technology throughout the industry and its paradox of consequences.
To understand the housing crisis more fully, between 2019 and December 2023, the author completed six independent studies covering all areas of the housing industry, spending over five years and 10,000 work hours on its production. It includes over 1,400 pages underpinned by over 3,500 cited references from over 10,000 pages of documents and nearly 500 quotes from industry insiders

Study 1--The Washington Study---about 100 pages

To understand the housing crisis more fully, we conducted a detailed rent analysis of the increase in rental rates for two Segments of the Washington State housing market from 2013-2018. To accomplish this, we compared rents in three metropolitan areas where Artificial Technology was deployed (in King, Spokane, and Thurston County-Segment 1) to those where it was not (Franklin, Yakima, and Walla Walla-Segment 2). The study found no reasonable economic reasons for the skyrocketing rental rates of 96.24 percent in Segment 1 compared to the modest rental rate increase of 9.9 percent in Segment 2. Both control groups' economies were verified, and other contributing economic factors were eliminated. The study's Peer Reviewer, Fideres Partners, LLC., recommended expanding the study.

Study 2--Appendix ‘A’ The Pricing Concentration Study (Expanded Washington Study) ---about 300 pages.

The second step included the Metro Seattle Market Concentration Study. The study focused on concentration analysis, which measures competition between property management companies in the given market, including their use of a shared pricing platform. The measurement of concentration level reveals market structure, behavior, and performance in the rental market industry. The first objective was to define the market, which consisted of three zip codes. The rental unit data was pulled from the popular rental site Apartments.com—CoStar provides the data. Per the Scope and Methodology, the first step was determining the number of property managers using the technology. Our second step set out to determine when they acquired the technology. The third step of the process is to verify the number of rental units under management and the number of competitors in the defined market. By hand count, the studies confirmed that nearly 320,000 individual rental units were using the technology to price them.

Study 3--Appendix ‘B’ the Property Managers: ---about 150 Pages

The significance of this study sheds light on the new breed of property managers and the changes they have implemented in their financial and organizational structures to remain competitive, including their use of PropTech technology and the common pricing platform. Includes an in-depth look into the Top Ten management companies. It also contains a section detailing how they finance their properties.

Study 4--Appendix ‘C’ The Technology and the Technology Providers: —about 100 Pages

Study 5--Appendix ‘D’ Experian RentBureau: ---about 100 Pages

Of all the studies, this is one of the most critical since the Platform relies on Experian to provide vast amounts of tenant data. The study analyzed the overly close relationship between the common pricing platform, its members, and Experian. It also exposes the various third-party connections that provide vast amounts of intimate details about their tenants.

AI reimagined the rental industry; however, our research revealed that the investors formed a consortium to frame it. The same investors who built the Platform also created RentBureau as a means to get to the tenant data. Although they sold it to Experian (a partner), they retained the licensing agreements and rights to all that data. RealPage and Experian have also formed a two-sided Digital Operating Platform which allows them access and share massive amounts of tenant data, so much so that the study deemed them co-gatekeepers to housing.

Study 6--Appendix ‘E’ How The Multifamily Tax Exemption (MFTE) Program impacts The Affordable Housing Markets: ---about 130 Pages

The MFTE programs to build affordable housing incentivize construction through property tax breaks, yet, the program amounts to a tax burden shift. However, these taxes aren’t discretionary; they include city services such as police, schools, firefighters, infrastructure, etc. For example, if the city needed one hundred dollars to operate, they would collect the one hundred dollars. In short, the tax consequences are redirected to other taxpayers who already pay their fair share.

An Economic Impact Study was completed to determine whether the MFTE Program, as implemented in 2018 by Metro Seattle, met its objectives and program goals. The study included a cost-benefit analysis on four tax-exempted apartment properties closed in 2017 to determine if the program's annual cost of $137 million provides sufficient benefit for the lost tax revenues. In other words, does the cost of the program equal the benefits? The conclusion offers a warning to cities that are considering its use.

This study further highlights the larger problem of affordable housing: the builder’s vertically-integrated and interconnected management organizational structures that have become highly concentrated. Those overly close relationships have led to widespread fraud and abuse in the financing programs.

In February 2021, the findings of this research were shared with ProPublica, to break the story. In early 2023, the author received a Civil Investigative Demand (CID), similar to a subpoena, from the Department of Justice to turn over this work. These studies underpin the DOJ lawsuit against the owner and manager of the industry's common pricing platform, RealPage, for, amongst other offenses, price fixing.
This work also underpins the various lawsuits against RealPage and this industry for price fixing, including the suits filed by the various States Attorneys General. The author maintains consulting agreements and is an expert witness with multiple legal firms prosecuting RealPage.

This research underpins the legal cases against RealPage, the owner and operator of the industry's common pricing platform (Platform).

Target Audience: Housing policymakers, federal, state, and local government agencies and elected officials, the legal community, Academia, and affordable housing activists.

Book 2 (Short intro)

The results of the studies are being released in two versions. The first version will be released through a book, The New Landlord Powered by Big Data and Artificial Intelligence, which summarizes the studies written in layperson's terminology or a non-legal version. It describes how the technology is designed to work, the massive profits it generates, and the negative impact on the tenants. It also contains stories from housed and unhoused tenants and the profound effect this technology has had on their lives. The book has 145 reading pages and about 49,000 words.

The second is the legal version, or white paper, that underpins the legal cases against RealPage and the industry and is recommended for those seeking greater technical resources. It summarizes the six studies into about 350 pages and contains thousands of citations and references. This version will be released through this website.

Coming Soon - October 2024

Book 1 (Short intro)

Stealing Home: How AI is Hijacking the American Dream

The Government Sponsored Enterprises (GSEs), Fannie Mae, and Freddie Macs’ Risky Lending Practices

The Office of Inspector General (OIG) concluded that the Federal Housing Finance Agencies' oversight of the GSEs was weak. Directors responsible for approving the quality and types of loans had been purposefully kept out of the decision-making process. In one transaction, the FHA, through its approved lenders, insured more than 9,500 illegal loans worth $1.9 billion. The research concluded that the GSEs had not strengthened their underwriting criteria since the 2008 market crash. Even more troubling is the enormous risk from the Shadow Banking System, which processes over two-thirds of all housing transactions. They remain unregulated and, worse, uninsured from financial crashes--no FDIC insurance here. Yet, the Taxpayer remains the guarantor to that $7 trillion housing debt, much of which consists of nonrecourse loans to billionaires. Further, many of the loans are based on subprime qualifications. Risk is growing exponentially within the financial bubble.

The Investors have Pushed FHFA into Chaos

Additionally, HUD played a significant role in the 2008 Great Recession. Fannie Mae and Freddie Mac, The Enterprises, were reportedly the recipients of $191.5 billion in taxpayer bailouts. Do we see a repeat of HUD’s role in another pending economic crash, or has HUD been tamed? Prudent policy and procedures have been bypassed and overlooked, as pointed out repeatedly by the OIG. The most basic functions, such as internal audits and exams to ensure the organizations adhere to policies and procedures, haven’t been completed in years. The internal audit program established for the regulator FHFA, at the cost of over $7.7 million to the Taxpayer, sits in shambles.

Additionally, the GSEs haven’t been able to balance their books following GAAP for more than five years. Worst yet, the GSEs’ Allowance for Loan and Lease Losses was deemed unreliable by the OIG as of September 2018. More troubling yet, to this day, the FHFA’s management cannot account for those who have access to the new AI-driven system platform—passcode holders and, more critically, those who hold the highest levels of clearance to all online activity and databases.

AI Technology Powers HUD and its affiliates

The process began with an Executive Order on Maintaining American Leadership in Artificial Intelligence issued on February 11, 2019. On August 14, 2018, Secretary Carson announced that the position of HUD’s chief information officer (CIO) would report directly to him. Chapter 8 details the chronological timeline of the implementation of AI technology, the urgency of the Trump Administration to control it, and the group in charge of implementing it. Furthermore, we answer the question, was it implemented fairly and equitably or based on discriminatory practices?

The Affordable Housing Crisis.

There is a significant financial crisis in the market for affordable housing in this country, with debt backed by the government's guarantee reaching over $7 trillion-the most in US history and far more than in 2008. Compare that to the fact that America has a crippling shortage of over 7 million affordable housing rental units. The book also details that homelessness is a ten-step process engineered by landlords to maximize property owners' profits. The book answers why the crisis exists, who and what is responsible, and what we can do about it as consumers, tenants, and concerned citizens.

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Current Blog Post

The Harlan Crow—Clarence Thomas connection no one saw coming—RealPage

By James M. Nelson | Apr 18, 2023

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“Stealing Home is a brilliantly researched book into why rental prices are escalating throughout the country. We must demand answers from those who can fix this crisis. Nelson shows us what we can and must do to fix this. Reporters, please read and investigate this. Now!”
Julie Blacklow
Former KING-5 Seattle Investigative Journalist

“James Nelson has done the movement for affordable housing a huge favor by writing this explosive new book about Artificial Intelligence technology. Tenants threatened with evictions can fight back against landlord’s greed. Nelson’s research justifies a thorough investigation by the responsible public officials.”
Mike Withey
Human rights lawyer, former president of the Public Justice Foundation

“Nelson’s compelling research correlates artificial intelligence, rising rental prices, and in many cases, discrimination within AI algorithms during a time when we need answers and accountability for sky-rocketing multifamily rental rates.”
T’wina Nobles
President, and CEO, Tacoma Urban League