Zillow, one of the largest U.S. real estate marketplaces, is facing new legal action. On October 1, 2025, five states—Virginia, Arizona, Connecticut, New York, and Washington—filed an antitrust lawsuit in federal court in Alexandria, Virginia, alleging that Zillow and Redfin conspired to limit competition in online rental advertising.
The allegations against Zillow and Redfin
According to the complaint, Zillow paid Redfin $100 million to exit the apartment advertising market and restrict itself to displaying only rental listings already shared with Zillow. The deal, reached earlier this year, allegedly bound Redfin to stay out of that market for nine years and terminate existing contracts with large property managers.
The attorneys general argue that this agreement has far-reaching consequences. By removing a major competitor from the advertising landscape, they claim, Zillow and Redfin weakened incentives for platforms to compete on price or service. That, in turn, could harm both property managers—who would face higher ad rates and less choice—and renters, who risk reduced transparency and higher housing costs.
“Zillow paying Redfin to exit the market harms renters and property owners by taking away free market incentives to provide high-quality services that businesses and consumers rely on,” said Virginia Attorney General Jason Miyares. New York Attorney General Letitia James added that renters, who already represent more than 30% of U.S. households, could face even steeper prices as a result of weakened competition.
Zillow and Redfin’s response
Both Zillow and Redfin have rejected the claims, describing them as a mischaracterization of their agreement. They argue that the deal benefits property managers by giving them access to a broader audience of renters through a consolidated platform. “Our agreement expands reach for advertisers and increases visibility for renters,” Zillow said in a statement. Redfin added that it remains confident it will prevail in court.
The case follows Redfin’s July 2025 acquisition by Rocket Companies, parent of Rocket Mortgage, which has drawn attention to its role in the broader real estate marketplace.
Zillow’s broader legal landscape
This lawsuit is only the latest in a series of legal challenges for Zillow. The company is currently defending itself against:
- Seattle class action (2025): Claiming Zillow steered homebuyers toward affiliated partner agents rather than listing agents.
- Compass lawsuit (2025): Accusing Zillow of attempting to monopolize exclusive home listings.
- CoStar lawsuit (2025): Alleging large-scale copyright violations tied to listing data.
Source: Reuters
