Compass Files Ethics Complaints Against Zillow

Compass International Holdings filed Code of Ethics complaints against Zillow last week, spanning 26 states, 55 Multiple Listing Services (MLS), and 30 Realtor associations. The complaints allege that Zillow has made false advertising claims concerning property listings. A Compass spokesperson stated that Zillow is withholding publicly marketed listings from buyers by not prioritizing them, and in some instances, displaying active listings as "not for sale."

In response, a Zillow spokesperson clarified that the company marks blocked homes as "not available" rather than "not for sale." Zillow suggested that Compass's action is a reaction to an ongoing legal battle involving Zillow, Compass, and Midwest Real Estate Data (MRED). Zillow characterized Compass's business model as dependent on restricting initial listing access, thereby limiting reach, and then expecting Zillow to compensate for this strategy. The company asserts that agents who list properties publicly from the outset reach all buyers on Zillow, and that homes shopped privately before a wider public listing are not displayed on Zillow to ensure fairness for homebuyers without insider access, which Zillow considers a stance for a transparent housing market rather than false advertising.

The National Association of Realtors (NAR) emphasizes that Realtors adhere to a Code of Ethics as a condition of membership, distinguishing them from general real estate licensees. This Code of Ethics, established over a century ago, has recently gained public attention due to Compass's widespread complaints against Zillow.