Consumer Groups Demand State AG Probe of Real Estate Platforms

Nineteen consumer advocacy organizations sent a letter on Wednesday urging state attorneys general to investigate major real estate platforms. The groups claim these platforms have made housing less affordable nationwide. The letter was addressed to Connecticut Attorney General William Tong, who currently presides over the National Association of Attorneys General.

Signatories include the American Economic Liberties Project and the Consumer Federation of America. They seek a multistate working group to examine specific industry practices. The focus includes Zillow’s recent settlement terms and Compass’s internal marketing methods.

Zillow settlement terms under scrutiny

The letter follows an August 24 settlement between the Federal Trade Commission, five states, and Zillow. Zillow paid $100 million to rival Redfin to exit the online rental listings market. The advocacy groups argue this deal allows Zillow to retain customer relationships and scale. Redfin must rebuild its rental advertising business from scratch within six months.

Under the agreement, Redfin must build a new customer portal and hire a sales team. Zillow must allow existing customers to exit contracts without penalty for nine months. Zillow also continues sharing rental listings with Redfin. The FTC alleged Zillow and Redfin controlled over 85 percent of nationwide revenue in this sector.

Compass practices and referral fees

The coalition accuses platforms of routing inquiries to brokers who pay referral fees. They argue this bypasses listing agents and distorts competition. The letter cites Compass’s practice of marketing homes within its own network before public listing. They view this as evidence of persistent commission-fixing practices.

The groups reference the 2024 antitrust settlement by the National Association of Realtors. They claim this settlement proves that restrictive practices remain common. The letter specifically calls for an examination of Compass’s acquisition of Anywhere.

Call for multistate investigation

The organizations requested the formation of a dedicated multistate working group. This group would examine Zillow’s compliance with the recent settlement. It would also investigate mortgage-related kickback arrangements. The source material is attributed to GN auto markets/housing: rental market.

The FTC’s original case stemmed from an October 2025 lawsuit. It accused Zillow and Redfin of violating the Sherman and Clayton Acts. The alleged agreements eliminated competition in rental advertising. The coalition believes state-level oversight is necessary to address these gaps.