Zillow and Redfin settle FTC antitrust case over their rental listings partnership

Zillow paid Redfin $100 million in February 2025 to exit the multifamily rental market. Now, the Federal Trade Commission (FTC) has mandated that Redfin rebuild that same business from scratch.

The settlement, announced August 24, 2026, ends an antitrust lawsuit filed last year. Regulators alleged that the original agreement was an illegal attempt to eliminate competition by paying Redfin to shut down its independent internet listing services, transfer its customers to Zillow, and promise not to compete for multifamily listings for nine years. This arrangement applied to Redfin and its sites, ApartmentGuide.com and Rent.com, according to NorthJersey.com.

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The FTC and attorneys general from Arizona, Connecticut, New York, Virginia, and Washington argued the deal threatened to raise costs for landlords and renters while lowering service quality. New York Attorney General Letitia James stated the agreement threatened to raise costs for both renters and landlords and make it harder for New Yorkers to find a place to live, via The Real Deal.

Zillow disputed these claims, asserting the partnership expanded listing access. The company noted in a press release that multifamily properties on Redfin websites nearly quadrupled after the deal began.

The resolution comes with a set of operational mandates designed to force Redfin back into the market as a competitor.

• Infrastructure Rebirth: Redfin must relaunch its independent rental listings advertising business within six months of the settlement being finalized. This includes investing in technological infrastructure and rehiring for roles vacated during the 2025 wind-down.
• Recruitment Access: Zillow must provide employee information to Redfin and waive any non-compete agreements that would prevent those employees from being hired by Redfin.
• Contract Flexibility: For nine months after Redfin relaunches, Zillow must allow rental listing customers whose contracts cannot be canceled within three months to renegotiate their terms without penalty.
• Financial Penalties: The two companies will pay $2 million in costs and fees to the five participating states.

Despite the mandate to compete, the two companies will not become total strangers. A non-exclusive syndication partnership—where they share rental listing data—will continue through at least June 30, 2030. This means that for several years, renters may still see the same listings on both platforms.

The real divergence begins in 2027, when both firms are permitted to offer standalone multifamily advertising products. This move is intended to shift the market from a controlled partnership to one where Redfin and Zillow compete for property management clients independently.

The FTC frames this as a restoration of choice. Daniel Guarnera, director of the FTC’s Bureau of Competition, said the settlement unwinds an agreement under which Zillow paid Redfin $100 million to stop competing and hand off all its customers to Zillow, via The Real Deal.

Zillow, however, maintains the partnership remains a benefit. Michael Sherman, Zillow Rentals general manager and SVP, described the resolution as a win for renters and multifamily housing providers, via The Real Deal. Zillow's spokespeople have emphasized that the syndication aspect of the deal remains intact and the outcome reflects the procompetitive nature of the partnership, according to The Olympian.

While the settlement avoids a trial and contains no admission of liability or wrongdoing by Zillow, the operational burden now shifts to Redfin. The company must execute a rapid rebuild of its sales team and technical stack while continuing to distribute Zillow's data.

Redfin now faces a strict six-month deadline to relaunch its independent advertising service or face fines.

Court-Ordered Market Restoration

The settlement was reached in a Virginia federal court on August 24, 2026, the same day a trial was scheduled to begin. The case had progressed through the federal system since the prior year, with the FTC filing the initial lawsuit in September and a judge consolidating it in December with separate actions from five state attorneys general. The legal battle included a July ruling in which a federal judge declined a request from the FTC to immediately block the partnership.

The FTC alleged the original 2025 deal violated the Sherman and Clayton Acts by eliminating Redfin as a competitor in the internet listing services market. According to The Olympian, Washington Attorney General Nick Brown co-led the state coalition that sued in October 2025, arguing that market competition is essential for fair advertising.

The operational requirements extend beyond staffing. Redfin must eliminate any existing terms that require it to divulge sensitive business information to Zillow. To facilitate the rebuild, Zillow is prohibited from interfering with Redfin's ability to recruit employees and must share employee information to allow for interviews, according to NorthJersey.com.

While the two companies transition toward competition, they will still operate within a concentrated market featuring incumbents such as CoStar Group, which manages Apartments.com. Redfin must now manage the financial challenge of investing millions of dollars into its technical stack while continuing to distribute Zillow's data. For Zillow, the company has reaffirmed its financial outlook for the remainder of 2026.

Redfin is now required to report its progress regularly to the FTC. The next step is the execution of the six-month relaunch window, after which Redfin faces fines if it fails to meet the established deadlines.