Nov 2, 2025
With rent prices already going up in 2025, this news may not make Americans feel any better about the state of the rental market.
Zillow and Redfin, two online real estate companies, are being sued by both state and federal government officials. According to USA Today, attorneys general from five states have filed a joint lawsuit against the two companies, and the Federal Trade Commission has filed its own lawsuit as well (1).
Advertisement
The lawsuits claim Zillow and Redfin engaged in an illegal scheme that was designed to stop competition in the online rental advertising business. This could increase the cost of advertising a rental property online, while leaving consumers with fewer options and potentially higher costs for rental units.
Thanks for subscribing!
Read the best of Moneywise in 5 minutes or less.
By signing up, you accept Moneywise Terms of Use, Subscription Agreement, and Privacy Policy.
Zillow, Redfin accused of violating antitrust laws
Officials from Arizona, Connecticut, New York, Virginia and Washington — along with the FTC — claim that Zillow and Redfin violated federal antitrust laws, including Section 1 of the Sherman Antitrust Act and Section 7 of the Clayton Act.
These violations allegedly occurred when Zillow reportedly paid Redfin $100 million in order to shut down the latter's online rental advertising business and transfer its clients over to Zillow. The lawsuits also allege that, as part of the deal, Redfin fired hundreds of employees before turning around and helping Zillow to rehire some of them.
"This agreement is nothing more than an end run around competition that insulates Zillow from head-to-head competition on the merits with Redfin for customers advertising multifamily buildings," states a portion of the lawsuit from the five states.
Unfortunately, if the two companies did in fact unlawfully collaborate, this could have negative consequences for consumers. This alleged scheme is believed to have the potential to drive up the cost of online advertising for rental units, and if it becomes more expensive for landlords to advertise, they may pass those costs on to consumers.
This could also leave consumers with fewer rental options, especially if smaller landlords can't afford to advertise on a major rental listing website like Zillow.
The lawsuit seeks an injunction to prohibit Zillow and Redfin from engaging in the alleged illegal collusion and requests that the court mandate a "divestiture of assets or reconstruction of businesses to restore competition."
Zillow and Redfin, however, have denied the accusations and claim the partnership was necessary because Redfin didn't have enough customers to maintain the cost of its rental sales force.
Advertisement
"Partnering with Zillow cut those costs and enabled us to invest more in rental-search innovations on Redfin.com, directly benefiting apartment seekers," Redfin shared in a statement, according to USA Today. "Our partnership with Zillow has given Redfin.com visitors access to more rental listings and our advertising customers access to more renters."
Zillow also agreed that the partnership was good for consumers, releasing an email statement that described the deal as "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."
Must Read
- The ultra-rich use these 5 real estate strategies to build wealth while they sleep — you can start with just $100
- Here’s the average income of Americans by age in 2026. Are you keeping up or falling behind?
- Insurance companies profit most from drivers who auto-renew without shopping around. Comparing 100+ quotes takes 2 minutes and costs nothing
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
How consumers can navigate a tough rental market
Consumers who may be worried about a lack of competition in the online rental listing marketplace can make the choice to look beyond these large websites to find properties to rent. This could potentially help said consumers to find more listings from landlords who may not be able to afford the potentially high advertising prices.
Beyond Zillow and Redfin, renters can try alternatives like local newspaper classified ads, Craigslist and Facebook Marketplace. They can also reach out to friends and use social media to see if anyone knows someone trying to rent their property, or work with a local real estate agent to expand their rental options.
By taking the time to research what a rental property should cost, and using more than just the big websites for rental listings, renters can hopefully find a property that is a good fit for their needs and charges a fair price.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
USA Today (1)
You May Also Like
- JP Morgan sees gold hitting $6,000/oz before 2027 — and a Gold IRA lets you hold the physical metal while deferring the tax bill. Get your free guide from Priority Gold
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s what it is and the simple steps to fix it ASAP
- Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
- Millionaires under 43 are reshaping investing — just 25% of their portfolios are in stocks. Here’s where their money is going
Christy Bieber has 15 years of experience as a personal finance and legal writer. She has written for many publications including Forbes, Kilplinger, CNN, WSJ, Credit Karma, Insurify and more.
