Senator Ken Barker (R-Colo.) and Senator Mike Lee (R-Utah) sent a letter to the Federal Trade Commission on Thursday, raising antitrust issues related to the residential real estate industry, especially the $500 million acquisition by Zillow Group ShowingTime. Aksios The news was first reported.
This letter (read the full text below) highlights the increasing antitrust scrutiny of technology giants in various industries and is the latest antitrust-related criticism faced by Seattle-based Zillow.
Zillow announced in February that it would pay $500 million for the acquisition Show time, A Chicago-based real estate company that sells software to promote home presentations.
Republican senators said that this pending transaction “may further consolidate Zillow’s consumer information advantage, thereby harming the interests of home buyers and their competitors.”
Since Zillow acquired Trulia for $2.5 billion in 2015, the company “has made additional acquisitions and expanded as a broker, directly competing with brokers and agents who rely on these tools to conduct business.”
The letter cited Zillow’s home buying business and its Zestimate real estate valuation tool, as well as other acquisitions, including purchases of Dotloop, Bridge Interactive, StreetEasy and Nakedapartments.
“Although the consumer experience may benefit from certain technological innovations in the real estate industry, antitrust law enforcers should remain vigilant to ensure that the competitive environment is maintained and the online real estate industry is not over-integrated into the hands of dominant platforms. And consumer damage,” the letter read.
They added: “Congress is working to resolve competition issues that are difficult to solve by the dominant technology platforms on the Internet. Even if Zillow can prove that its planned acquisition of ShowingTime can bring benefits to consumers, real estate agents, and brokers, antitrust regulators Any potential anti-competitive effects should also be carefully reviewed.”
The following is a statement from Zillow to GeekWire:
“Since we announced the acquisition of ShowingTime, ZIllow and ShowingTime have worked constructively with FTC staff to conduct a thorough review of the transaction.
Our mission has always been to “turn on the light” for consumers, providing them with previously hidden information or information that was difficult to access through tools such as Zestimate and the posting of millions of agent and lender reviews. Zillow’s tools are designed to maximize transparency, support simplicity, and broaden options for customers—allowing them to connect with local real estate professionals to guide their real estate journey—whether they are buying, selling or renting.
The key to our mission is our commitment to modernizing real estate transactions-real estate transactions have been notorious for resisting consumer-friendly changes for decades. By establishing an open and fair service that all agents and brokers can use, including ShowingTime after the transaction ends, we are helping the industry move towards a more efficient digital future for the benefit of consumers. “
Earlier this year, Zillow was filed by Austin-based real estate startup Real Estate Exchange in an antitrust lawsuit that alleged that Zillow’s anti-competitive behavior was related to the way certain houses were displayed on its platform.
Zillow said in February that it will use ShowingTime’s technology to develop its Premier Agent business, which will help bring potential customers to real estate agents. The company said it plans to use ShowingTime as an “open platform” for anyone to use, just like the previous acquisitions of Dotloop and Bridge Interactive.
This transaction will be Zillow’s second largest acquisition by price to date, second only to the acquisition of Trulia in 2015. This is the company’s 17th acquisition so far.
Zillow is acquiring ShowingTime as it continues to invest in and develop its home buying and selling service Zillow Offers.
The pandemic and the real estate boom have helped drive Zillow’s recent growth, and its most recent quarter revenue increased by 70% to $1.3 billion. The company’s Premier Agent business revenue was 348.7 million U.S. dollars, an increase of 82% year-on-year.
Zillow CEO Rich Barton said in a statement: “Zillow has made rapid and significant progress in building seamless, integrated real estate experiences for our customers and partners.”
Read the entire letter below. This letter is addressed to the new FTC chairman Lina Khan. She was confirmed in June and attracted attention for criticizing large technology companies. For example, Amazon is seeking to exclude Khan from an antitrust investigation into its $8.5 billion acquisition of MGM Studios.