A coalition of consumer and housing advocacy organizations is urging state attorneys general to launch coordinated investigations into dominant real estate listing platforms, pocket listing strategies and referral-fee driven agent matching systems, arguing that current practices are distorting housing markets and keeping costs elevated for buyers and renters.
HousingWire has exclusively learned that a group of national and state-based advocacy organizations plans to send a letter to Connecticut Attorney General William Tong, in his capacity as president of the National Association of Attorneys General (NAAG), and to member attorneys general, on Wednesday morning, calling for “housing market integrity” to become a coordinated enforcement priority.
The coalition, which includes American Economic Liberties Project, Americans for Financial, Reform Education Fund, Arkansas Community Organizations, Children’s Advocacy Alliance, Consumer Action, Consumer Federation of America, Demand Progress Education Fund, Economic Empowerment Center DBA Lending Link, Lake Research Partners, Native Voters Alliance NV, Nevada Chapter of the National Organization for Women, Nevada Justice Association, New Jersey Citizen Action, Open Markets Institute, Oregon Consumer League, Progressive Leadership Alliance of Nevada, Revolving Door Project, Virginia Citizens Consumer Council and the William E. Morris Institute for Justice, argues that a series of recent developments show the housing market “is broken” in ways that harm families in every state. The letter, addressed to Tong at NAAG’s Washington, D.C., headquarters, urges state enforcers to use consumer protection, unfair and deceptive acts and practices (UDAAP) laws and antitrust tools to address structural concerns.
Zillow-Redfin settlement as a “bellwether”
The letter cites the recent Federal Trade Commission (FTC) and multistate action against Zillow and Redfin as a “bellwether case.” In September 2025, the FTC and the attorneys general of Arizona, Connecticut, New York, Virginia and Washington sued the two firms, alleging that Zillow used its $100 million multifamily rental syndication deal with Redfin to induce Redfin to exit the online rental listings market and suppress advertising competition.
In August 2026, just as the suit was about to go to trial, the parties agreed to a settlement that will modify the deal and require Redfin to re-enter the rental listings business, resolving both the federal and state claims. But the advocacy groups argue the settlement does not fully restore pre-deal market dynamics. Zillow, which they note draws roughly two-thirds of U.S. real estate web traffic, keeps the syndication relationship, customer base and scale built through the partnership, while Redfin must rebuild its rental marketplace.
The coalition notes that Zillow has publicly stated it intends to maintain its broader partnership with Redfin and that Redfin has said the settlement allows it to keep the relationship in place through at least 2030, pointing to public reporting and company statements. In the groups’ view, that leaves “the underlying issue” of platform power and incentives unresolved.
“Amidst the housing affordability crisis, the Trump administration has again sided with corporate giants like Zillow over everyday Americans. State attorneys general must step up in this moment to make sure the housing listings market is fair and competitive,” Demand Progress Corporate Power Policy Advisor Ella Fanger wrote in an emailed statement.
In a statement on Zillow’s Front Porch blog a Zillow spokesperson directed HousingWire to, the company highlights the lack of a “centralized or consistent mechanism to search for apartments,” which the company claims forces renters to “bounce from site to site trying to see all the inventory, missing listings that could be the right fit.”
“So, our partnership with Redfin is a solution to that problem. By syndicating multifamily listings across platforms, we can get more properties in front of more renters — wherever they happen to be searching,” the statement reads. “Since the partnership launched, multifamily properties on Redfin’s websites nearly quadrupled and multifamily properties on Zillow’s websites grew almost 40%. This means renters are getting access to more inventory in more places and housing providers in the category are filling vacancies faster and at lower customer acquisition costs.”
Redfin did not immediately return HousingWire’s request for comment.
Compass-Anywhere merger and pocket listings
The letter also flags brokerage consolidation as a structural concern. In January 2026, Compass completed its $1.6 billion acquisition of Anywhere Real Estate, creating an entity involved in nearly one in five U.S. home sales, according to public reporting cited in the letter. The authors argue that Compass’s growth has leaned heavily on “pocket listings” — marketing properties inside its own network before or instead of exposing them to the wider market.
Under that model, the groups say, buyers who are not working with a Compass agent may never see certain listings, and sellers face a smaller buyer pool and potentially lower offers. The letter also criticizes the prevalence of dual agency and dual representation within single brokerages, where one firm represents both sides of a transaction, as creating conflicts that can disadvantage consumers while maximizing fee capture for intermediaries.
Compass International Holdings did not immediately return HousingWire’s request for comment.
Several states, including Connecticut, Washington and New York, have recently advanced or enacted legislation requiring properties marketed privately to be listed concurrently on a public multiple listing service. Those moves reflect growing concern among policymakers that “information-hoarding distorts the market,” the groups say. But they characterize state-by-state legislative fixes as insufficient for what they describe as a national problem involving large, multi-state brokerages and platforms.
Another major focus of the letter is the business model of dominant listing platforms and lead-generation marketplaces. When a consumer clicks “Contact Agent” on many property listing pages, the inquiry is often routed not to the listing agent but to a buyer’s agent who has agreed to pay the platform a referral fee that can reach up to 40% of the commission, according to academic work and news reports cited by the groups.
The coalition argues that the design of these interfaces can mislead consumers into believing they are contacting the professional who is most knowledgeable about a specific property, when in fact they are being sold as a lead to a paying broker. The letter points to a June 2026 request by Reps. Jennifer McClellan and Don Beyer that the FTC scrutinize whether such platform designs mislead consumers into relationships and financial obligations they did not understand.
The advocates say state attorneys general need not wait for federal action to review these practices. They argue that routing inquiries in a way that obscures the true nature of the agent relationship could violate state UDAAP and consumer protection statutes, particularly where disclosures are unclear or buried.
A spokesperson for Zillow also shared a Front Porch blog post regarding how Zillow handles referrals. The post notes that Zillow does not reward agents that send leads to its mortgage originator Zillow Home Loans and that the referral fees it charges do not increase transaction costs for consumers.
Post-NAR settlement landscape
The letter situates these concerns in the broader context of the National Association of Realtors’ (NAR) commission lawsuit settlement. Per the settlement, NAR agreed to a series of business practice changes, including changes to how buyer broker compensation is offered and displayed.
Advocacy groups contend that, in practice, dominant platforms and referral networks have stepped into the space created by that settlement, capturing a large share of commission economics through referral fees and lead-selling arrangements that leave individual agents with limited ability to discount. As a result, they argue, consumers still face “full price” compensation structures for buyer representation, undermining the intended impact of the litigation.
For housing professionals, this evolving landscape raises operational and compliance questions. Agents and brokerages are retooling their business models in light of the NAR settlement, while regulators at both the federal and state level are testing new theories on platform design, steering, fee disclosure and market power.
Specific actions requested from NAAG and state AGs
The coalition asks NAAG and state attorneys general to take several concrete steps related to the issues it highlighted.
Regarding Zillow, the coalition asks that NAAG monitor the listing portal giant’s compliance with its August settlement over rental listings and open broader consumer protection investigations into dominant listing platforms. Areas of focus would include any anticompetitive or deceptive practices that make housing less affordable or accessible, especially user flows that route “Contact Agent” inquiries to paying brokers rather than listing agents and interface designs that obscure who represents whom.
As for referral practices in the industry, including “contact agent” buttons on portal, the letter asks the the state attorneys general investigate patterns and practices of alleged mortgage kickbacks between large online platforms and mortgage lenders, which could implicate both state consumer laws and federal statutes such as the Real Estate Settlement Procedures Act if improper referral arrangements are found.
Finally, they are also asking the NAAG to scrutinize Compass’s alleged pocket listing strategies and enforce state laws requiring concurrent public listing of privately marketed properties. The groups also urge state AGs to review the Compass-Anywhere merger under state merger review and antitrust statutes and to challenge the deal where it may substantially lessen competition.
To accomplish these initiatives, the letter asks the state regulators to create a multistate working group to share evidence, coordinate litigation and align enforcement approaches so national platforms and brokerages cannot exploit jurisdictional gaps between states.
The letter emphasizes that state UDAAP statutes, consumer protection laws and antitrust authority “provide every tool necessary to act.” The question, in the authors’ view, is whether those tools will be used aggressively to reshape incentives in the residential real estate marketplace.