What Happened
The Federal Trade Commission, joined by Arizona, Connecticut, New York, Virginia and Washington, announced a settlement resolving its antitrust litigation over an agreement between Zillow and Redfin. The FTC alleged that Zillow paid Redfin $100 million to shut down its internet listing services business, transfer customers to Zillow and stay out of the market for as long as nine years.
Under the proposed ten-year order, Redfin must reenter the online rental advertising market within six months. It must build the technology, hire staff, market the service and operate it as a meaningful competitor. In short: Redfin left the apartment-listing business after accepting a giant check, and the government is now telling it to get back in the pool.
Competition, Now With Mandatory Participation
The FTC’s complaint said the 2025 arrangement dismantled one of the country’s major competitors in multifamily rental advertising. Zillow operates sites including Zillow Rentals, Trulia and HotPads. Redfin’s portfolio included Rent.com and ApartmentGuide.com. The agency said Redfin agreed to end contracts with advertising customers and make its sites mirror Zillow’s listings.
That may be a terrific deal for the company receiving $100 million. It is less terrific for renters and property managers if two large places to list apartments become one large place with a former competitor standing outside holding a check.
The Government’s Undo Button
The settlement removes restrictions on Redfin’s ability to sell advertising, display its own customers’ listings and compete independently. Redfin will also continue syndicating Zillow’s listings without the restraints that blocked it from seeking additional listings. That means the reborn Redfin is supposed to return with more inventory than it had before the deal.
Zillow must provide employee information so Redfin can interview Zillow workers and waive noncompete or anti-poaching barriers that could prevent them from moving. For nine months after Redfin relaunches, certain Zillow customers will be able to renegotiate contracts without cost or penalty. The arrangement is less “business partnership” and more “court-supervised relationship counseling.”
The Dumb Part
The dumb part is paying a competitor to disappear and then acting surprised when regulators ask where the competition went. Antitrust law exists partly because a market can become less competitive even when the paperwork says two companies agreed voluntarily. “Everyone signed the contract” is not a defense against an agreement whose purpose and effect may be to remove a major rival.
It is also a fine reminder that housing markets are not improved by making it harder for renters to see listings or for property managers to reach customers. Apartment hunting already has enough mystery fees, ghost listings and photographs that appear to have been taken during the previous administration.
The Bottom Line
The FTC says the order will restore competition and drive down costs. Zillow and Redfin will have ten years of obligations, and Redfin faces monetary penalties if it does not restart on schedule. The proposed order still requires approval and signature from a federal district judge. If approved, Redfin’s rental business will return—not because it missed the work, but because the government decided the market missed having another company doing it.
Sources
FTC: Order resolving antitrust concerns with Zillow-Redfin agreement
FTC: Original lawsuit over the rental advertising agreement
TechCrunch: Zillow and Redfin settle FTC antitrust case