Zillow's listings battles converge: a class action and an FTC settlement in the same week
New York renters sue Compass for allegedly hiding listings to inflate rents, while the FTC settles with Zillow and Redfin over an anticompetitive partnership.
Two separate legal actions involving Zillow landed within days of each other, and together they outline the fragility of rental listing supply chains in major metros. A class action complaint filed in New York and an FTC settlement with Redfin both point to the same structural problem: whoever controls the flow of listings controls the market.
Compass faces a class action over hidden listings
Two New York City renters, Peter Castaneda and Haley Gelfand, filed a class action complaint on August 21 alleging that Compass, the largest residential brokerage in Manhattan, systematically delisted thousands of rental units from Zillow and its owned platform StreetEasy earlier this year. According to the complaint, Compass controls over 80 percent of Manhattan rental listings based on 2025 data, giving it the ability to manipulate what renters see and what they pay.
The mechanics are straightforward. Compass allegedly pulled inventory from free platforms like Zillow to force renters through brokerage channels where Compass agents collect fees often pegged to monthly rent. By shrinking the visible supply on platforms where renters actually search, the complaint argues Compass created an artificial supply shock. The plaintiffs cite data showing available rental units across New York dropped 40 percent in the past year, corresponding with a 6 percent rent increase in July alone.
Castaneda signed a lease in August for a downtown Manhattan one-bedroom at $5,270 per month. One month earlier, the median asking rent in that area was $4,390. The complaint attributes the differential, in part, to the reduced public listing supply on StreetEasy.
Zillow responded to the mass-delistings by establishing new standards excluding private listings from its sites, a move designed to deter the practice. Compass then filed its own antitrust suit alleging Zillow was monopolizing the market, but voluntarily dismissed it in March after a judge ruled Compass was unlikely to succeed on the merits. The judge noted that home buyers research across multiple platforms, undermining any monopoly claim. Federal and state antitrust probes remain active, with U.S. Senator Elizabeth Warren calling Compass’s conduct anti-competitive.
Compass declined to comment.
FTC settles with Zillow and Redfin over a 2025 partnership
Separately, the FTC announced a settlement on August 24 with Zillow and Redfin, ending a case alleging their 2025 partnership violated antitrust law. The FTC had alleged Zillow agreed to pay Redfin to syndicate listings while Redfin would terminate its own advertising contracts and stop competing with Zillow for multifamily rental listings. The practical effect: Redfin would stop being a direct competitor in the rental listings space.
Under the settlement, Redfin can continue syndicating rental listings from Zillow without the original deal’s anticompetitive restrictions. Redfin must also restart its own rental listings advertising business, which it wound down as part of the partnership. The settlement was joined by the state attorneys general of Arizona, Connecticut, New York, Virginia, and Washington.
FTC Bureau of Competition director Daniel Guarnera said the settlement “delivers better, quicker, more certain results for both renters and property management companies than we would have been able to achieve after prevailing at trial.”
What this means
The two cases expose the same vulnerability from different angles. Compass allegedly withheld supply from platforms to extract fees and inflate rents. Zillow and Redfin allegedly coordinated to reduce competition in listings distribution. In both cases, the underlying problem is that a small number of actors can manipulate rental search infrastructure with outsized effects on housing costs.
For engineers working on real estate or rental platforms, the takeaway is about data access as market power. Listings are the core product. When a brokerage controlling 80 percent of a market’s inventory can pull data from aggregators at will, the aggregator’s value proposition collapses. Zillow’s response—excluding private listings—was a structural intervention that tried to change the game rather than play within it, but it also reduced visible supply further in the short term.
The FTC settlement with Redfin is more conventional: restore a competitor that had been sidelined through a contractual arrangement. Redfin restarting its rental advertising business should add a distribution channel that had been suppressed, though it remains to be seen whether the restored competition materially affects listing prices or availability.
Both cases also illustrate the limits of platform competition in real estate. Zillow, StreetEasy, and Redfin are all search layers on top of a supply chain controlled by brokerages. When the brokerage layer asserts control over data flow—either by hiding listings or by contracting competitors out of the market—the platform layer has limited recourse. The class action and the FTC settlement are both attempts to reassert some form of competitive pressure on a market where control of listing data is concentrated in very few hands.
For renters in New York, the immediate question is whether the combination of legal pressure, Zillow’s policy changes, and restored Redfin competition will actually increase visible inventory. The 40 percent drop in available units suggests the supply side is under severe stress from multiple directions, and litigation alone may not reverse it.