The Federal Trade Commission filed a lawsuit on September 30, 2025, against real estate companies Zillow and Redfin, alleging the companies entered into an illegal agreement that eliminates competition in the online rental advertising market.
According to the FTC’s complaint, on February 6, 2025, Zillow paid Redfin $100 million as part of an agreement in which Redfin would exit the internet listing services (ILS) advertising market for multifamily rental properties, terminate its existing advertising contracts, and transition those customers to Zillow.
The deal involves properties with 25 units or more and prohibits Redfin from competing in multifamily rental advertising for up to nine years. Under the arrangement, Redfin’s websites will serve as a syndicator of Zillow listings.
Just after announcing the plan, Redfin terminated hundreds of employees and agreed to help Zillow hire its preferred workers from those who were fired.
The FTC alleges that Zillow and Redfin’s agreement violates Section 1 of the Sherman Act and Section 7 of the Clayton Act. The complaint states that the arrangement is “nothing more than an end run around competition” that eliminates head-to-head competition between two of the three leading providers of ILS advertising.
“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 U.S. housing market,” said Daniel Guarnera, Director of the FTC’s Bureau of Competition.
The FTC’s complaint details that Redfin was required to turn over competitively sensitive information to Zillow, including customer details. Redfin also provided information to facilitate Zillow’s hiring of fired employees and customer transitions.
The FTC alleges the agreement will likely lead to higher prices and worse terms for multifamily unit advertising, and will reduce incentives for Zillow and Redfin to compete for renters by investing in improved user experience and visitor engagement.
According to the complaint, advertising customers who used both platforms may face immediate price increases, as those who paid for preferred placement on Redfin’s sites may now require more expensive subscription tiers to gain comparable visibility on Zillow’s platform.
The FTC is seeking to stop Zillow and Redfin from continuing the agreement and the potential divestiture of assets or business reconstruction to restore competition.
Additional Reading
FTC Sues Zillow and Redfin Over Illegal Agreement to Suppress Rental Advertising Competition, Federal Trade Commission (September 30, 2025)
FTC Sues Zillow and Redfin over deal it accuses of suppressing competition in rental ads, AP News (September 30, 2025)
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