MRED Plans to Cut Zillow’s Chicago Listing Feed

Zillow will likely lose a huge swath of home listings in the Chicago area this week in a major escalation of the home search giant’s fight with the regional Multiple Listing Service.

Midwest Real Estate Data, the MLS operator for northern Illinois, said in a press release on Monday it would suspend its data feed to Zillow if Zillow did not comply with the MLS’s rules about displaying listings that are marketed in private channels before going public.

Just hours earlier, Zillow asked a federal judge to block MRED from cutting off its listing feed, just as a lawsuit it filed last week against MRED and Compass International Holdings goes forward.

MRED said Zillow has until 11:59 p.m. central time on Tuesday to display all listings syndicated on the MLS or face losing its access to the central database for tens of thousands of Chicago-area real estate listings.

In a statement, MRED CEO Rebecca Jensen said the MLS operates its rules consistently and asked Zillow to follow its agreement with the MLS.

“The rules of this MLS exist to protect every participating broker and every consumer who relies on a complete and accurate picture of the market,” Jensen said. “Those rules apply equally to every participant, regardless of the size of their audience or the reach of their platform.”

The dispute centers on Zillow’s efforts to block home listings that were marketed in private channels — such as MRED’s Private Listing Network or Compass’ “Private Exclusives” offerings — before going public. MRED says refusal to display those listings is a violation of its licensing agreement that forbids websites from filtering listings based on the broker or brokerage attached to them.

For months, MRED and Zillow have been in a stalemate, and Zillow was not enforcing the rules in the Chicago area. MRED has been threatening for months to cut off Zillow’s feed, Zillow alleged in a lawsuit filed last week.

The dispute went national in April when MRED announced it was opening access to the MLS and private network to any agent in the country, while Compass agreed to syndicate its national inventory to the MLS.

Because Compass’ national inventory is now part of MRED’s feed, Zillow’s blocking of listings by Compass agents who pre-market privately anywhere in the country are a violation of MRED’s policies. Shortly after the expansion, according to both Zillow’s lawsuit and MRED’s statement, MRED told Zillow its attempt to block several listings in other states violated its rules.

A Zillow spokesperson said the announcement is an attempt to pressure Zillow before the federal court can rule to temporarily block MRED’s enforcement.

“Here’s what MRED is actually demanding: that Zillow display Compass’s hidden listings in places like California and Florida — markets thousands of miles outside Chicago that MRED has never operated in — or lose access to every listing in Chicagoland,” the spokesperson said. “A Chicago MLS is using its monopoly over Chicago listings as a weapon to protect Compass listings on the other side of the country.”

Earlier this month, Compass International Holdings cut off the direct listing feeds to Zillow for all its brands nationwide, which make up about 35 percent of Chicagoland transaction volume, according to Zillow’s lawsuit. Zillow is still receiving those listings through MRED, but will lose them if MRED cuts its feed.

The data blackout would be a significant loss of listing volume for Zillow in the third-largest real estate market in the country, but it wouldn’t erase all local listings on the popular home search website. Zillow has worked with Chicago brokers and brokerages to build direct feeds of their inventory which could replace the central data feed from MRED.

The move will also mean a big drop in exposure for listings that aren’t directly syndicated to Zillow, including for Compass agents in the Chicago area. Zillow has a massive share of the home search market, outpacing the next two largest competitors — Realtor.com and Redfin — in monthly traffic combined.

“If MRED follows through, Chicago sellers will lose access to millions of buyers, Chicago buyers can no longer see all available homes and thousands of independent agents will lose leads,” the Zillow spokesperson said.

In the press release, MRED noted that if it cuts off Zillow’s feed, “listings will continue to be published on thousands of compliant consumer-facing websites.”

In Zillow’s court filing Monday, the company argued that blocking MRED from cutting off listing data is in the public interest to protect consumers while the lawsuit plays out.

Zillow also said the injunction is necessary to avoid harm to Zillow Preview, a pre-marketing tool the company launched in March as an alternative to off-MLS marketing platforms that aren’t shown on Zillow. Losing the MRED feed would “shut down Zillow Preview in its infancy,” the company wrote.

Compass did not immediately respond to a request for comment.