There’s a storm brewing in the real estate tech world. Zillow, long dominant in online home search, now finds itself under legal assault on multiple fronts. From accusations of hidden commission schemes to outright copyright claims — the latest lawsuits could reshape how buyers, sellers, and agents interact with Zillow.
In simple terms: these lawsuits claim Zillow is playing fast and loose with transparency, and that regular people trying to buy homes might be paying the price. This review by lead purveyor HouseJet should give you some clarity as to what’s happening and how it could impact you.
What’s Going On — The Legal Claims
Several new lawsuits have hit Zillow in 2025. Two of the most prominent:
- Class-action suit over Zillow’s agent referral practices
In Seattle, a proposed class action (Alucard Taylor v. Zillow Inc.) alleges Zillow misleads buyers into working with agents it controls, rather than the agent who originally listed the home. The suit says that when buyers click “contact agent,” Zillow often routes them to a Zillow-affiliated buyer agent, without disclosing that such agents must pay Zillow up to 40% of their commission — money that comes out of a hidden cost to the deal. From HouseJet’s perspective, there’s no proof yet that home prices and/or realtor commissions are increased to make up for these fees, so it remains to be seen how much weight this lawsuit will carry.
Additionally, the complaint argues that this setup incentivizes agents to push for higher commissions, limits negotiation, and inflates home prices. It also accuses Zillow’s “Listing Access Standards” — rules that force sellers and agents to post homes publicly to Zillow within a short time frame or risk being banned — of being coercive and anticompetitive.
- Copyright lawsuit from CoStar over photo use
In New York, CoStar Group claims Zillow used tens of thousands of real estate photos it owns — many with watermarks — without permission, then sublicensed them to other platforms like Realtor.com and Redfin. The damages being sought could exceed $1 billion.
These legal actions are layered on top of earlier challenges. In June, brokerages like Compass sued Zillow, alleging that Zillow’s “ban” on listings that don’t appear quickly enough on its site is anti-competitive and designed to crush private listing strategies
Zillow, for its part, denies the claims. It says the lawsuits misrepresent how Zillow operates, and that it is committed to giving buyers and sellers the freedom to choose agents who truly represent them.
Why It Matters: The Stakes for Buyers, Agents & the Market
At first glance, these lawsuits may seem like legal jockeying among the big kids on the block. But the ripple effects could reach everyday homebuyers and agents.
- Hidden costs can look like barriers
The Department of Justice (DOJ) had laws changed last August to improve transparency between real estate agents and real estate consumers. The goal: making sure that buyers and sellers could move forward with a clear understanding of where the money in a transaction goes. It could be that the same sort of open look will be required of agents who buy Zillow’s leads. - Monopoly risk and distorted competition
Zillow’s dominance gives it power to steer listings, traffic, and agents. If it can fine-tune rules that force agents and brokers to conform, the market may lose innovation and choice. - Copyright enforcement and image control
If the CoStar case succeeds, Zillow and other platforms may face stricter constraints on using listing photos. That could change how homes are marketed and how inventory is presented. - Changes to consumer expectations
Buyers may become more cautious, asking agents direct questions: who is paying whom, and how much commission is going where?
HouseJet’s Take: Mike Oddo Speaks Out
As HouseJet’s CEO, Mike Oddo has watched Zillow’s growing power with concern. Though his public commentary on these specific lawsuits is limited, here’s how he frames the issues in conversations and videos related to Zillow’s practices:
“At the end of the day, buyers deserve transparency — you don’t want someone pulling strings behind the scenes that you never see.”
These statements (drawn from recent public remarks and videos) reflect a broader skepticism about Zillow’s control over listings, commissions, and buyer interaction.
From HouseJet’s vantage point, the crux is trust. If Zillow is operating in ways that obscure how commissions and agent referrals really work, that’s a dangerous precedent in real estate. Transparent, client-first systems — the kind that HouseJet often promotes — may gain traction if these legal challenges push the industry toward reform.
What Could Change — And What to Watch
Here are key outcomes to keep an eye on in the months ahead:
|
Potential Outcome |
What Changes for the Market |
|
Settlement or forced disclosure |
Zillow may be required to show how it routes buyers and takes fees — increasing transparency. |
|
Stricter regulation or court rulings |
Rules may emerge limiting how referral or agent programs can share commissions or route business. |
|
More competition |
Smaller platforms or new players could emerge to challenge Zillow’s control. |
|
Listing practices overhaul |
New norms for how and when homes must be posted on Zillow or similar sites may arise. |
For homebuyers and agents, this means asking tougher questions: Does your agent owe you even more loyalty? Who is getting paid behind the scenes? Are you being nudged toward a Zillow-affiliated agent without knowing it?
Final Thoughts
Zillow built its empire on simplifying home search, pulling listings and photos into one place. But with power comes scrutiny — especially when that power can influence which agent you contact or how much commission is hidden in the mix.
The new wave of lawsuits challenges Zillow’s foundational assumptions: that it can act as both listing portal and referral gatekeeper without scrutiny. Buyers and agents are pushing back.
From our perspective at HouseJet, this moment could be pivotal. If consumers demand transparency, and if courts or regulators push Zillow to open its “black box,” real estate could shift towards even more fairness and clarity. That’s a direction we always believed in.
Wally Bressler, Real Estate Industry Veteran and Market Expert
Contributing Writer from HouseJet
9/25/2025