Lawmakers flag Zillow deal for FTC scrutiny
Top Republicans in the House and Senate antitrust subcommittees want the FTC to dig into Zillow's plans to buy a home-showing scheduling platform amid concerns about competition in the residential real estate market.
Why it matters: Federal antitrust scrutiny of tech deals keeps widening, and any hot market in which tech is playing an increasingly big role — like real estate — is likely to come under regulators' eyes.
Driving the news: Rep. Ken Buck (R-Colo.) and Sen. Mike Lee (R-Utah), the ranking members of the House and Senate antitrust subcommittees, urged FTC chair Lina Khan to "closely examine competition issues" in the real estate market, and highlighted Zillow's acquisition spree.
- The online real estate company has expanded to operate as a broker, and announced in February plans to buy scheduling platform ShowingTime for $500 million.
- The lawmakers fear the acquisition could "further entrench Zillow’s consumer information advantage to the detriment of homebuyers and their competitors."
What they're saying: They also worry that Zillow's Zestimate could "unduly influence" homeowners trying to sell their homes.
- "The effect of Zillow’s acquisitions appears to be that it can effectively tell the homeowner what their home is worth, buy the home from the homeowner for that amount, and then turn around and immediately sell the home for a higher price," the lawmakers told the FTC.
Between the lines: The letter underscores the prospect that regulators may look at services like Zillow as platform owners who should not be allowed to participate in the marketplaces they operate.
The other side: In announcing the deal, Zillow said ShowingTime would remain an open platform and the acquisition will help make scheduling home showings easier.
- The FTC did not immediately respond to a request for comment on the letter.
- “Key to our mission is our work to modernize the real estate transaction — which has been notoriously resistant to consumer-friendly change over the decades. By building an open and equitable service which is available to all agents and brokers, which will include ShowingTime, we are helping move the industry towards a more efficient, digital future that works to benefit consumers," a Zillow spokesperson said in a statement.
Editor's note: This story has been updated with comment from Zillow.