The US Federal Trade Commission (FTC) has filed a lawsuit against real estate giants Zillow and Redfin, accusing the companies of making an illegal agreement that suppressed competition in the online rental advertising market.
The complaint, filed on Tuesday in a federal court in Alexandria, Virginia, alleges the deal began in February 2025, when Zillow paid Redfin USD 100 million (about AUD 155 million).
In exchange, regulators say, Redfin agreed to exit direct competition in multifamily rental advertising for up to nine years, end existing contracts with advertising partners and instead act as a syndicator of Zillow’s listings on its own platforms.
The Guardian reported FTC also alleges Redfin laid off hundreds of employees soon after the arrangement was reached, while helping Zillow recruit selected staff.
“Zillow paid millions of dollars to eliminate Redfin as an independent competitor in an already concentrated advertising market – one that’s critical for renters, property managers, and the health of the overall US housing market,” said Daniel Guarnera, director of the FTC’s Bureau of Competition.
He said the companies’ actions violate federal antitrust law and are likely to drive up advertising costs for landlords of large rental properties while reducing incentives to improve the user experience for renters.
Zillow, which reports around 227 million unique visitors a month and 2.4 billion site visits between January and March 2025, defended the deal.
A company spokesperson said the syndication partnership with Redfin “benefits both renters and property managers” and has “expanded renters’ access to multifamily listings”, describing the arrangement as “pro-competitive and pro-consumer”.
Redfin, acquired earlier this year by Detroit-based mortgage group Rocket Companies, also rejected the allegations.
The company said it “strongly disagrees with the FTC’s claims” and maintains the Zillow partnership has broadened rental listings for its users and delivered more renters to advertisers.
Redfin added that by late 2024 it had concluded its own rental ad sales force was no longer financially sustainable.
The FTC’s lawsuit seeks to unwind the deal and restore competition, with possible remedies including divestitures or restructuring of parts of the businesses.
This isn’t Zillow’s first antitrust challenge in 2025.
In June, rival brokerage Compass sued the Seattle-based company, claiming it uses “monopoly tactics” by banning homes marketed privately for more than one day from being listed on Zillow, Redfin and eXp Realty’s platforms.
Compass argued the policy forces sellers to list on Zillow so the company can monetise every home search.
The case is now before the US District Court in Alexandria.
