By Jody Godoy
Aug 24 (Reuters) – The U.S. Federal Trade Commission and a group of states settled with Zillow ahead of trial on Monday, ending claims the online real estate platform illegally paid Rocket Companies’ Redfin $100 million to stop competing in apartment rental listings.
The FTC and five states were ready to argue at trial scheduled to start Monday that the Zillow-Redfin partnership drove up costs for landlords and decreased listing quality for renters. More than 30% of Americans rent their homes, according to census data.
Under the settlement, Redfin can continue to display Zillow ads on its sites but will resume its rental advertising business within six months, the FTC and states said.
While Democratic state attorneys general have clashed with the Trump administration on other matters, both the FTC and the states called the settlement a win.
New York Attorney General Letitia James said the lawsuit restored competition in online listing platforms, “critical tools that New Yorkers rely on to find affordable homes.”
Virginia, Arizona, Connecticut and Washington were also plaintiffs.
FTC Chair Andrew Ferguson said the settlement will provide competition in rental markets that is “an integral component of President Donald Trump’s domestic housing agenda.”
A Redfin spokesperson said the settlement allows the company to maintain its partnership with Zillow through at least 2030 while building its own rentals business.
Zillow rentals executive Michael Sherman said the settlement is positive and “enables us to keep our energy on innovating for renters and property managers.”
ZILLOW-REDFIN PARTNERSHIP ALLEGEDLY RAISED AD PRICES
Zillow and Redfin made a deal in February 2025: Redfin would wind down its rental listing business, refer its customers to Zillow, and display copies of Zillow’s listings on its site. Redfin agreed to stay out of the business for up to nine years.
In return, Zillow agreed to pay Redfin $100 million, plus fees for each renter who signaled interest in a property.
The FTC sued the companies, as did New York, Virginia, Arizona, Connecticut and Washington. They said that before the deal, Zillow and Redfin were competing to list vacancies in buildings with more than 25 units.
After Redfin stopped competing, Zillow customers paid an average of 14.5% more per listing, an expert for the FTC and states estimated, while some property managers stopped buying online listings.
Zillow had said in court papers that the deal put more listings on both sites and helped it compete with market leader CoStar Group. Exclusive deals are common in the industry, Zillow had said.
(Reporting by Katharine Jackson and Daphne Psaledakis; Editing by Chizu Nomiyama)
Comments