Property tech companies are helping landlords spy on residents, collect their data, and even evict them. Critics are calling it an invasion of privacy that could reinforce inequality.

• Landlords are increasingly using facial recognition software and other surveillance technologies to track tenants' movements and collect their data.
• The companies selling "proptech" claim their products make residents safer, but some say flaws and biases mean they're really just accelerating gentrification and invading people's privacy.
• Researchers with the AI Now Institute built an interactive map to let tenants report if their buildings have deployed new tools to surveil them and educate people about the issues with proptech.
• One of the researchers told Business Insider that these new technologies need to be designed with more input and consent from residents or they'll "reproduce biases" that already exist in both tech and real estate.

Imagine returning home after work and being required to get your face scanned in order to enter your apartment building. For some renters, the prospect might seem harmless, even convenient — like Apple using Face ID to grant access to your phone.

But if you're a person of color, woman, undocumented immigrant, or simply someone struggling to make ends meet during the pandemic, that scenario suddenly becomes much more worrisome.

Will the scan actually recognize you, given the well-documented racial and gender biases that tend to be baked into facial recognition technology? Will your data be shared with law enforcement agencies, which are now buying it from private companies in lieu of obtaining warrants? Will it even be used to predict whether you'll make rent?

While these scenarios may sound slightly dystopian, more landlords are turning to facial recognition and other forms of property tech, or "proptech," not just to surveil residents, but to keep out "undesirable" ones in the first place, according to researchers who study the intersection of technology and housing.

Proptech companies claim they're disrupting a stodgy old real estate sector to make it more efficient while improving convenience and safety for residents. But researchers counter that, because of flaws and biases in both the tools themselves as well as the underlying data, the actual effect is that many of these tools end up accelerating gentrification, in a process some have called "digital redlining."

"It clearly seems to be a racist way of saying: 'Look through your tenants who you don't want to live here and replace them with tenants who you do,'" Erin McElroy, a researcher at the AI Now Institute and cofounder of the Anti-Eviction Mapping Project, told Business Insider.

What is proptech?

Proptech is a sprawling industry that encompasses a variety of technologies and companies aimed at modernizing how real estate companies and landlords manage their properties and interact with renters.

It includes home and neighborhood surveillance products like Amazon-owned Ring, Google Nest, and Nextdoor; virtual property management and tenant-screening services; real estate data and brokerage sites like Zillow and Redfin; and short-term rental platforms like Airbnb and VRBO.

But it includes lesser-known names like facial recognition makers Stonelock and GateGuard as well as financial companies like TransUnion, which offers credit report services to landlords and consumers.

McElroy said proptech really took off in the wake of the 2008 housing crisis "as an idea to disrupt the legacy industry of real estate and make it more efficient, frictionless."

Today, according to the market research firm Unissu, there are at least 2,048 proptech companies in the US alone, with more than half focused on the residential real estate market.

How does proptech impact residents?

McElroy, along with a team of researchers and tenant groups, recently launched a project called "Landlord Tech" to document where and how landlords are deploying proptech.

Their team is collecting information from residents to map the use of technologies like cameras, "smart locks," facial recongition, and apps used by landlords to manage their interactions with residents.

While proptech companies offer a wide range of products and services, one aspect that unites many of them is their reliance on artificial intelligence and big data. But due to the well-documented issues with algorithmic bias and the lack of transparency or laws around how residents' data is collected, used, and shared, that raises a number of concerns.

The team behind Landlord Tech identified two main categories of proptech: "surveillance tech" and "speculation tech."

The former encompasses products like tenant-screening tools, property management software, doorbell cameras, and neighborhood-based social media apps that help landlords keep tabs on what tenants are up to — or who they rent to in the first place — and have a more direct impact.

Multiple media reports, studies, and court rulings have detailed how automated background checks often turn up incorrect information and discriminate against people of color, how facial recognition software is worse at recognizing Black and female faces, and how "neighborhood watch" apps like Ring's Neighbors and Nextdoor can encourage racial profiling.

McElroy said many tenants told her that they questioned landlords' motivations, especially given their landlords' unresponsiveness to past complaints about building safety and reluctance to tell residents how they'd use the data.

"They were saying: 'This technology isn't designed for us, it's designed to detect us doing things we're not supposed to be doing to abet our evictions and then create housing for people who are not historically targeted by the surveillance,'" McElroy said.

They said some proptech companies are even marketing their products as a way for landlords to discover who won't be able to make rent during the pandemic.

Regardless of intentions, the second category of proptech, which includes homebuying, selling, rental, and financing platforms, has a more subtle but equally harmful impact, according to the researchers.

These sorts of services rely on historical real estate data, which is the result of years of racist housing policies and predatory lending practices. They also advantage corporate lenders and property managers, which the researchers say are often more exploitative of renters. Studies have also shown that the rise of short-term rental platforms like Airbnb is directly linked to rising rent prices and benefits a small subset of property owners while pushing out long-term residents.

The upshot: McElroy said tenants see proptech — whether surveillance or speculative — as accelerating "gentrifying trends in their neighborhoods."

How are renters pushing back?

In a few instances, tenant groups have pressured landlords to ditch surveillance tech. Residents of the Atlantic Plaza Towers in Brooklyn, New York, convinced the building's owner to abandon plans to install facial recognition technology.

While the legal landscape is largely uncharted, lawmakers in Congress and in New York City have proposed bills that would ban the use of facial recognition and other biometric data in public housing. Civil rights groups and regulators have also challenged companies like Facebook in court, claiming their algorithms (which impact who sees housing ads) are racially biased.

McElroy said that if these technologies are ultimately going to be developed and deployed in residential buildings, "they need to be designed from the bottom up — with and not for, or about, the people currently living there — from day one, a consensual, collaborative process."

"Otherwise it's just going to reproduce the biases built into the tech industry and built into the real estate industry," they said.