NY joins antitrust lawsuit against Zillow and Redfin

The office of New York Attorney General Letitia James has joined a coalition of states suing Zillow Group Inc. and Redfin Corp., two of the nation’s largest online apartment rental companies, for an illegal scheme to stop competing.

In addition to New York, the plaintiff states are: Arizona, Connecticut, Washington, and Virginia.

Zillow and Redfin, which owns Rent.com, are two of the top three companies doing online advertising for apartment rentals.

In February 2025, Zillow and Redfin entered into agreements under which Zillow paid Redfin $100 million to shut down its apartment rental advertising business and transfer its clients to Zillow. The lawsuit alleges that the agreements violate federal antitrust laws.

“Millions of New Yorkers rely on online apartment listings to find an affordable and safe place to live,” James said in a news release.

“Zillow’s attempt to shut down its competition could drive up costs for advertisers and leave renters with fewer options when searching for a new apartment,” James said.

The market for online apartment rental advertising is highly concentrated, with Zillow, Redfin, and CoStar (which owns Apartments.com) accounting for 85 percent of all market revenue, according to the lawsuit.

Competition between Zillow and Redfin ended when they implemented what she calls an unlawful scheme through two agreements signed in February — a partnership agreement and a content license agreement.

Under the partnership agreement, Zillow paid Redfin $100 million to exit the market for advertising apartments in buildings with 25 units or more and transfer Redfin’s multifamily advertising business to Zillow.

Under the content license agreement, Redfin agreed to stay out of the multifamily advertising market for up to nine years and instead use its network to show only apartment rental listings that are also displayed on Zillow’s sites.

The agreement is currently limited to buildings with 25 or more units, but it expressly proposes an extension to all apartment buildings, according to the plaintiff states.

As a result of this unlawful agreement, Redfin fired approximately 450 employees associated with its multifamily rental advertising business, the suit claims.

The coalition argues that Zillow and Redfin’s unlawful scheme significantly hurts competition in the apartment advertising market.

This lack of competition could result in higher prices, lower-quality rental advertising, and fewer choices for landlords seeking to advertise rentals and for renters seeking a home.

Zillow and Redfin’s agreements could also harm prospective renters by undermining the companies’ incentives to compete for traffic.

The suit claims that Redfin will earn revenue by referring renters to Zillow, reducing its incentives to improve its user experience and innovate to attract new customers.

The lawsuit seeks a court ruling declaring that Zillow and Redfin’s agreements violate federal antitrust laws, and an injunction that would prohibit Zillow and Redfin from engaging in their unlawful conduct and restore competition.

The lawsuit also proposes divestiture of assets or reconstruction of businesses to restore competition.

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