Zillow pays Redfin $100 million to eliminate competition in rental advertising

In the United States, the Federal Trade Commission filed a lawsuit against the online real estate firms, Zillow and Redfin, alleging that they engaged in an unlawful agreement that curtailed competition in the rental advertising market. According to the accusations, in February 2025, Zillow made a payment of $100 million to Redfin to prevent it from competing against them in the placement of rental housing ads. This agreement purportedly allowed Redfin to act as an exclusive syndicator for Zillow listings, leading to a significant reduction in competition in the advertising market for multifamily housing. As part of this deal, it is alleged that Redfin agreed to terminate its own contracts with advertising customers and cease competing in the advertising market for multifamily homes for a period of up to nine years. The FTC's lawsuit stated that this cooperation harmed renters and property managers by potentially leading to higher prices and deteriorated service in the advertising sector. The agency expressed concerns that suppressing competition could result in fewer incentives to attract renters to use these services. Zillow, which has a substantial presence in the real estate listings market, defended its actions by stating that its partnership with Redfin was beneficial for both property managers and renters. They argued that it enhanced access to multifamily listings and connected property managers with potential tenants effectively. Redfin, too, dismissed the allegations of anticompetitive behavior, stating that the partnership allowed them to better serve both their visitors and advertising customers. The case puts the spotlight on the competitive dynamics within the real estate advertising market and whether significant financial incentives can distort fair competition. The FTC intends to rectify this alleged violation of federal antitrust laws, requesting the court to dissolve the agreement and consider divesting assets accordingly. This situation also connects to other legal disputes involving Zillow, further complicating its business operations while under scrutiny by federal regulators for its practices in the real estate market.