Where Real Estate Gets Its Dirt

Zillow’s win sends Compass spinning

Overview

Rob and Greg go live to break down major news shaking real estate tech: a judge rules decisively in Zillow’s favor against Compass’s injunction, reshaping the conversation around exclusive listings and distribution. They also recap Inman, including leadership perspectives, vendor pitches, and the ongoing debate around AI’s role in real estate—optimism mixed with caution. 

Key Takeaways

  • Zillow wins the injunction: The court blocks Compass’s attempt to stop Zillow from enforcing its listing rules, signaling a strong legal position for Zillow.
  • Implications for Compass & MLSs: The ruling challenges Compass’s three-phase marketing strategy and shifts attention to MLS policies and enforcement.
  • Inman recap: Strong attendance, notable executive interviews, shade around the Compass/Anywhere deal, and lively “New Kids on the Block” vendor pitches.
  • AI sentiment: Widespread interest with cautious optimism—tools may enhance agents, but uncertainty remains about scope and impact.

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Zillow Home Loans Cost Consumers More?

Zillow Home Loans pay more, study suggests

“The 40-page report, titled “Empirical Analysis of Zillow Home Loans Pricing,” was published Dec. 21 by Georgetown University Professor of Economics and Law Emeritus Steven C. Salop. It received funding from CoStar, the parent company of Zillow home search rival Homes.com.

The study, which a Zillow spokesperson said draws “inaccurate and misleading conclusions,” pointed to two class-action lawsuits filed this fall — Taylor v. Zillow and Armstrong v. Zillow — which accuse Zillow of boosting ZHL through illegal kickbacks.”

CoStar hired a consultancy firm to investigate Zillow Home Loans. The consultancy firm hired a professor. The professor publishes a study saying consumers may end up paying more for a Zillow Home Loans over time. The consultancy firm that hired the professor come out saying it disagrees with the professor.

If you’re confused, so am I.

Having a strategic plan is a good idea.

“You’re playing a game whether you realize it or not, and seeing the game helps you play it better” – Seth Godin

I was forwarded Zillow’s “strategy document” last week and was asked if I had any opinions on it. I read the document, as much as I could since a lot of it was redacted (blacked out), and put it aside. Later I called my friend telling him my thoughts. Here are those thoughts.I was forwarded Zillow’s “strategy document” last week and asked if I had any opinions on it. I read what I could (most of it was blacked) and set it aside. Later, I called my friend and walked him through my thoughts. Here they are.

First, I was surprised at how early this came out. December 2024.

Then I thought: of course Zillow would be drafting something like this early. They’re a big company, and big companies plan ahead. They have responsibilities to employees and shareholders.

The document read like it came from a team that didn’t give a hoot about optics. That wasn’t their job. And honestly, you don’t want anyone crafting a strategic document with those biases anyway. You want cold, hard, black-and-white suggestions.

Some of the ideas were smart. Some weren’t. I have no clue how senior or junior the authors were, or what context they were given.

I didn’t plan to write anything about it, and what I definitely didn’t expect was for people to lose their freaking minds over a strategic plan. Then again, most of them were just using it to push their own agendas.

Every business should have a strategic plan. Having one is a good idea. You should do one.

And in my opinion, if your plan doesn’t have at least a few crazy ideas, you didn’t push hard enough.

Sam Altman, OpenAI CEO, talks about Zillow ChatGPT integration

An Interview with OpenAI CEO Sam Altman About DevDay and the AI Buildout

“Well, with these apps in there, is there a sense on your side it’s like, just to go back to the, “We have all this usage, it’s going to be better if I can just use Zillow in the app”? This idea of going somewhere else and Zillow says, “Oh, I’d rather them be in our app, we spent so much time on it”, do you feel you have the power to dictate, “For the user, it’s a better experience and because the users are here, if you’re not there, someone else will be” — and you’re sort of able to, dictate sounds bad, but if it’s a better user experience, that’s better for everyone else?

SA: No. Here’s another place that I think my early career training was useful. There was a version of this we could have done where it was a better user experience, but terrible for the partners.

What would that look like?

SA: Well, I mean, on that Zillow example, what if you just said like, “Hey, ChatGPT, find me all of the houses that meet these things”, and we said we’re going to control the UI.

Oh, right. So there’s not even a presentation layer of the Zillow app, you’re just getting the results.

SA: Yeah, yeah. But I felt really strongly that when we do this, it’s something that the whole ecosystem benefits from, and specifically that new startups can rocket into existence because of it. So we did this in a way where you very much have the relationship with the other site. You’re calling them by name, we’re suggesting them by name, they’re taking over the UI, they’re linking their account. So I think there was something we could have done that was maybe slightly more user-friendly, but not good for the other companies, and I really didn’t want us to do that.”

I’m a big fan of Ben Thompson’s blog Stratechery. Anytime his posts or interviews cross paths with real estate tech I get a little tingly. The clip above is very revealing. It’s clear Sam thinks the better version of the Zillow integration is one where ChatGPT controls the UI and UX. But his experience tells him he needs partners to succeed. Which is pretty lucky for Zillow in more ways than one.

Another point I would make. One could argue that ChatGPT version of returning results via a Zillow app is better, for the industry long term, than the current method of search results showing up on Google’s platform natively.

You might need a subscription, but I highly recommend listening to the full interview or reading Ben’s latest update.

Rob Hahn on the Zillow / ChatGPT controversy

I was being bombarded with texts and emails about my recent post on the Zillow ChatGPT app and whether Zillow was thumbing its nose at IDX rules. I didn’t have time to sit down and write my thoughts about it. Lucky for all of us, The Notorious ROB did an excellent job of explaining why he thinks there’s nothing to see here. Zillow also issued a response.

I’m never shy about calling out Zillow or anyone else when I think they’ve crossed the line, but in this case I agree with Rob — launching an app inside ChatGPT doesn’t violate IDX rules.

But I will say, I’m 100% sure that with things moving so fast we will be faced with data issues that may not be so straightforward.

Did you hear that sound? It’s Zillow winning…again.

I remember listening to a podcast featuring Rich Barton, founder of Zillow. He talked about how Zillow’s app being featured in Apple’s keynotes was a big boost for the company, not just from a consumer perspective, but inside Zillow as well. Having your app showcased, especially by Steve Jobs, was a huge feather in Zillow’s cap.

Fast forward to today: OpenAI just featured Zillow at their Dev Day 2025. Zillow is calling it “…the only real estate app in ChatGPT.” Here’s the section of the video where OpenAI demos the Zillow integration.

Did you catch that applause at 11:59? That’s the sound of Zillow winning the real estate AI race.

Everyone else is now playing catch up.

Zitigation?

Zillow Litigation Generator

“In the grand tradition of CoStar, Compass, and the FTC, it’s your turn to file a completely legitimate™ lawsuit against Zillow. Simply fill out the form below and receive your professionally formatted legal brief in seconds.”

Clever

Not so fast Compass…

Exclusive Inventory Update And Zillow’s Catch-22

“Assuming the goal is to change agent behavior and reduce exclusive inventory in the market, the metric to watch is the number of Compass exclusive listings.

And here’s where it gets interesting: the number of Compass exclusive listings since Zillow began enforcing its policy is UP – by over 1,300.”

Interesting article by Mike DelPrete. His data shows a decline in Compass exclusive listings when Zillow announced the “ban,” and an increase when Zillow started enforcing the “ban” on private listings. I realize there’s a lot of nuance around which listings are actually “banned” from Zillow, so bear with me.

At first glance, it seems pretty weird and counterintuitive. Rob and I, on our latest Industry Relations podcast, argue about what’s happening. He thinks this means big trouble for Zillow. I think the opposite (big surprise).

My take is it isn’t very clear what data Mike is showing. Are these just new exclusive listings? Or are these total exclusive listings? The title of the chart says “Compass Exclusive Inventory,” so my assumption is it’s all exclusive listings, old and new. If that’s the case, then my argument would be that the reason the number of exclusive listings is rising at Compass is because exclusive listings aren’t selling that quickly. Therefore, stale listings are sticking around longer as new exclusive listings are added, which shows up as an increase.

Are they not selling quickly due to not being on Zillow or just the overall market shifted during the Summer?

Either way, the takeaway is that the data doesn’t always tell the story you think it does — and in this case, it might just be telling us more about Compass than it is about Zillow. 

“Feeling around in the dark”

Adieu, house hunting! –
America may be copying the worst part of Europe’s real estate market

“In Italy, Boero says, he ended up having to carry out much of his search on foot, hoofing around town to peek at home listings posted in the windows of various brokerages. His real estate agent spent a lot of time on the phone, calling around to see what was available. For Boero, the whole thing felt like “feeling around in the dark.”

Great article from Business Insider.

It’s rare that a journalist outside our industry understands the nuance of the organized real estate market, but James Rodriguez gets it. I was especially glad to see the narrative shift from “banning listings” to something more constructive. Here’s another standout excerpt from the piece:

“In France, they’re laughing at the situation at this moment, honestly,” Ali Attar, a real estate tech executive in Paris, tells me. The system in the US, he says, is more fragile than people realize. “They are taking it for granted in the US,” Attar says. “And as soon as they destroy it, bringing it back will be extremely difficult.”

This is one of the best overviews I’ve seen of the real consequences of the infighting that’s dominating mindshare in the real estate industry.

Behind the scenes of the Zillow listings “ban”

Oh to be a fly on the wall….

COMPASS AGENT: Hey Bill, I just wanted to give you a quick call. Our CEO is in a fight with Zillow and I just wanted you to be aware your house won’t be listed for sale on Zillow.

Bill (Home Seller): Not on Zillow? Why? A fight?

COMPASS AGENT: It’s part of our “3 Phased Marketing” Agreement, remember the agreement you signed when you listed with us?

Bill (Home Seller): I never signed anything that said our house wouldn’t be on Zillow. That’s crazy, we found our house on Zillow ferchistsake…

COMPASS AGENT: Umm, well, we wanted to test the waters, remember, find the right buyer, our CEO says its the best thing eve……

Bill (Home Seller): Are you fucking serious?? I can tell you right now if you don’t put our house of Zillow I’m gonna fire you…

COMPASS AGENT: But what about Days on Market and…

Bill (Home Seller): –click—-

COMPASS AGENT: Bill?….Bill? Bill??? Shit.

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