Midwest Real Estate Data (MRED), which claims almost 50,000 members in the Chicago region, has issued a forceful public rebuttal to Zillow’s recent study alleging that private listings in Chicago reinforce housing segregation, pointing to internal Zillow documents as it argues the portal giant’s criticism may be driven more by business strategy than consumer protection.
Published last week, Zillow’s analysis found that homes in majority-white neighborhoods were 2.2 times more likely to appear on MRED’s Private Listing Network (PLN) compared to homes in majority-non-white areas. After controlling for price, home type, location and broker activity, 7.9% of homes in majority-white areas were listed privately compared to 3.4% in majority-non-white areas, Zillow said, arguing that private networks “risks deepening segregation.”
MRED’s response said the MLS takes fair housing very seriously, with rules and processes in place to scan all private and active listings for violations.
“We also believe that any bad actors deserve all consequences, professionally and legally, that come to them,” shared a spokesperson for MRED. “MRED launched the PLN in 2016 to make all properties available to all agents and brokerages across the market. We want to prevent the use of shadow networks off the MLS that could lead to discrimination and exclusion.”
MRED claimed that they reached out to Zillow seeking specifics around the methodology used in the analysis of private listings, but had yet to receive it.
Earlier this month, Zillow and MRED had their dispute over private listings spill into the public eye after Zillow reached out to some area brokers about its new listing standards and MRED responded. Zillow accused the MLS of seeking to protect its private listing network at the expense of consumers, while claiming it was working to negotiate and “educate” as it delayed implementing those rules in MRED’s area.
In its broader campaign against private listing networks, Zillow has argued that “transparency” through having listings available to all buyers is the best way to serve consumers and keep a level playing field for real estate professionals. The portal has publicly claimed that private networks will fracture the industry, and create “velvet ropes” that increase inefficiencies and confusion as buyers are forced to work with multiple agents or visit many platforms to see all available homes.
When contacted by RISMedia, a Zillow spokesperson said the following about MRED.
“If you take fair housing seriously, like you say you do, an analysis like this should make you pause and consider if there are unintended consequences to your practices that are leaving buyers of color out in the cold in the Chicago market. It’s disappointing to see defensiveness when the data is so clear that this practice is continuing Chicago’s long and sad history of a segregated housing market.”
Zillow’s internal documents reveal “hardline tactics”
MRED’s response repeatedly references confidential Zillow strategy documents that surfaced during the portal’s ongoing legal battle with Compass. The 30-page document, from Dec. 2024, outlines what Zillow internally called “hardline tactics to keep ALL listings in IDX, on Zillow.”
One of the “hardline tactics” was to “Mobilize local and national organizations to publicly warn brokers and agents on the fair housing risks of reduced access to real estate information.”
Other tactics include: suppressing and/or removing listings from uncooperative brokerages, threatening litigation and suppressing lead delivery.
“Given this context, it is not surprising that Zillow conducted a one-day study in the Chicagoland market that attacks MRED’s Private Listing Network (PLN),” MRED wrote in its response to members.
The Multiple Listing Service (MLS) noted that Zillow’s strategy document doesn’t explicitly mention protecting fair housing principles, but instead uses it as a tactic.
“Zillow’s strategy document does not explicitly mention protecting Fair Housing principles, outside of using as a tactic in its ‘Model Market Playbook,’ MRED stated. “As a contrast, Zillow wants ‘to punish the agent for choosing to put their listings on alternate networks’ like MRED’s PLN.”
The MRED response also quotes a local president of the Realists—the association of Black real estate professionals formed after they were racially excluded from Realtor® associations—who told Crain’s Business that “(i)n my opinion, our consumers are protected” from a segregation effect because MRED’s listings are available to “every real estate professional.”
What this is about
MRED did not mince words in its assessment of Zillow’s motivations, and also pointed to Zillow’s failed foray into iBuying, which the MLS argued is a practice that propagates segregation.
“In our opinion, Zillow’s approach in Illinois and its recent criticism of MRED’s PLN appears to be driven less by data and more by a cynical strategic objective: securing control over listing distribution to protect its revenue. Their criticism of MRED’s PLN does not seem to be about protecting consumers or advancing fair housing. It appears to be part of a broader strategy to secure complete control of listing distribution and
undermine the cooperative foundation of MRED.”
