Compass Sues Zillow As Real Estate Market Rift Worsens

A widening rift between real estate listings portal Zillow and the brokerage Compass could reshape the way the housing market functions.

A Zillow spokesperson said the company believes the claims are unfounded and that it will vigorously defend against them. I Photo: Harris Real Estate Coaching 

In the latest escalation, Compass has filed an antitrust complaint against Zillow over recent changes to its listing rules, Shaina Mishkin and Liz Moyer reported for Barron’s Daily.

Compass alleges that Zillow is using anticompetitive tactics to protect its monopoly and revenue through rules requiring that new listings be available on the Multiple Listing Service (MLS)—a national network—and syndicated to data feeds within a day, or else be blocked from Zillow and its Trulia platform.

A Zillow spokesperson said the company believes the claims are unfounded and that it will vigorously defend against them.

Generally, when a home is listed for sale, the agent posts it on the MLS and syndicates it. Compass recently adopted a three-phase strategy that starts with private listings on its own platform.

Compass says this strategy allows sellers to test pricing and market dynamics without accumulating “days on market,” but listing portals like Zillow have pushed back.

Consumer advocates argue that private listings limit access for buyers and can lead to lower sale prices for sellers. The buying and selling experience could shift further if holding listings off the market becomes more common in the future.

Meanwhile, homebuilder KB Home cut its outlook amid lower second-quarter profit and sales. It now forecasts housing revenue of $6.3 billion to $6.5 billion for 2025, down from an earlier forecast of $6.6 billion to $7 billion.

The company also reduced the upper end of its average sales price forecast to $490,000, down from $495,000.