5 states join FTC in suing Zillow, Redfin over rentals partnership 

Five states are suing Zillow and Redfin over a rental listings agreement the companies reached earlier this year — just one day after the Federal Trade Commission filed its own lawsuit against the home search giants.

The new complaint was filed on Oct. 1 in the U.S. District Court for Eastern Virginia.

How we got here: On Feb. 11, Zillow and Redfin said they'd reached a deal to make Zillow the exclusive multifamily rental listings provider for Redfin's family of websites, which include Rent.com and ApartmentGuide.com. A news release at the time said the partnership would "give renters access to a larger pool of available apartments" and enable property owners to "reach an even wider audience of renters across multiple platforms."

Following an investigation into the deal, the FTC sued the companies on Sept. 30, alleging that the $100 million deal violated federal antitrust laws and was part of Zillow's efforts to wipe out "critical" market competition.

What the new lawsuit says: The 36-page filing mirrors the FTC lawsuit, alleging that Zillow "has no interest in continuing to compete with Redfin" and claiming that the companies' partnership constitutes "an unlawful agreement to remove competition from this already highly concentrated market."

Which states are behind it? Arizona, Connecticut, New York, Virginia and Washington state have all signed on to the Oct. 1 lawsuit.

Attorneys General Kris Mayes of Arizona, William Tong of Connecticut and Nicholas Brown of Washington noted the high cost of living their constituents are facing in separate statements about the suit.

"Rent is completely unaffordable right now, and this deal is going to make things worse," Tong said. "This unfair and anticompetitive agreement between listing giants Zillow and Redfin will jack up costs for property managers, who will pass those costs on to renters."

What Zillow had to say: "Our listing syndication with Redfin benefits both renters and property managers and has expanded renters' access to multifamily listings across multiple platforms," a Zillow spokesperson said in a statement sent to Real Estate News. "It is pro-competitive and pro-consumer by connecting property managers to more high-intent renters so they can fill their vacancies and more renters can get home. We remain confident in this partnership and the enhanced value it has delivered and will continue to deliver to consumers." 

What Redfin had to say: "Redfin strongly disagrees with the allegations and is confident we will be vindicated by a court of law," the company said in a statement sent to Real Estate News. "Our partnership with Zillow has given Redfin.com visitors access to more rental listings and our advertising customers access to more renters. By the end of 2024, it was clear that the existing number of Redfin advertising customers couldn't justify the cost of maintaining our rentals sales force. Partnering with Zillow cut those costs and enabled us to invest more in rental-search innovations on Redfin.com, directly benefiting apartment seekers."