LAUDERHILL, FLORIDA - AUGUST 20: Claudia Teyssandier, Zillow Offers Renovation Estimator, wears a Zillow Group shirt as she evaluates a home for a possible purchase by Zillow on August 20, 2019 in Lauderhill, Florida. Zillow Offers was unveiled in the South Florida area this week as an innovative way to sell a home where Zillow will buy a home with a no-obligation cash offer and if the home owner accepts Zillow would then prepare the home for sale and put it on the open market. The program was launched in April 2018 in other parts of the country.
Zillow - the online real estate marketplace is once again going viral on the internet. But this time, it is not due to their unique property listings, but a lawsuit alleging the media company favoring the listings associated with the National Association of Realtors (NAR).
NAR is the largest real estate trade association in the country with over 1.45 million members.
The complaint also accused Zillow of hiding affordable house for sale listing, making it harder for homebuyers to see lower-rate properties from other competitors.
Antitrust Lawsuit
Based on the legal documents obtained by Reuters, the online real estate marketplace Rex (Real Estate Exchange Inc.) filed the lawsuit in U.S federal court in Seattle. The Austin-based startup is alleging Zillio and its subsidiary Trulia for giving less exposure to listings posted by agents not affiliated with NAR.
Rex said that Zillow is promoting listings from NAR brokers on their website, leading buyers to pay higher commission fees.
"Without any significant warning, Zillow unveiled its newly designed web display in mid-January 2021. The new web display creates a separate page, concealed behind the primary results, where REX homes are now funneled," the lawsuit states.
Rex also claims that their listings on Zillow are being featured behind an "other listings" tab, resulting in lesser views and sales on REX homes.
Rex said that house for sale listings from their company has been showing on Zillow's website, but it all changed when NAR signed a deal to join the online real estate marketplace last year.
Aside from paying damages and shouldering the attorney's fee, the lawsuit also requested the court to order Zillow to stop categorizing REX homes under the "other listing" tab.
Zillow and NAR's Response
In a statement sent to FOX Business, Zillow acknowledged the lawsuit but denied all the accusations therein.
"We are aware of the lawsuit and believe the claims are without merit and we intend to vigorously defend ourselves against it," a Zillow spokesperson said.
Meanwhile, the National Association of Realtors released a statement through Reuters, saying the complaint has "no legal basis."
NAR Spokesman Mantill Williams said: "It has been long recognized that the MLS system provides considerable pro-consumer, pro-competition value. REX's lawsuit seeks to undermine that."
MLS or Multiple Listing Services are databases of properties for sale in a specific region used by members of NAR and other realty professionals online.
Both Zillow and NAR said they are willing to face the lawsuit in court.
Zillow Business As Usual
Despite the antitrust lawsuit, on Friday, Zillow announced its plan to hire more than 2,000 employees nationwide before 2021 ends. This move will increase the company's workforce by approximately 40%.
Incoming employees will be assigned in tech, mortgage & loans, product & software development, and others categorized as remote and hybrid positions. It also includes both in-office and fieldwork. The job openings are open to applicants across the country.
When the pandemic hit last year, Zillow is one of the companies that allowed thousands of employees to work-from-home. Zillow also launched its Distributed Workforce Model, which offers office, field, remote, and hybrid formats to its current and potential employees.
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