What’s Really Going On With Zillow?

Lawsuits, Zestimates, Paid Leads — and Why It Matters More Than Ever Who You Work With

Zillow was supposed to make real estate easier.
One click. One Zestimate. One agent to help you book a showing.

But what’s actually happening behind the scenes is far more complicated — and it’s affecting buyers, sellers, and Realtors in ways most people don’t even realize.

From misleading pricing tools to lawsuits and a lead system that rewards the highest bidder (not the most qualified agent), Zillow’s model is raising red flags throughout the industry.

The Zestimate: A Nice Guess — But That’s All It Is

Zillow’s Zestimate is one of the most recognized tools in real estate… and one of the most misleading.

According to Zillow’s own data, the Zestimate has:

• A 1.9% median error rate for on-market homes

• A 7%+ error rate for off-market homes

And those are just the averages. In the luxury or custom market? The margin of error grows dramatically.

Zestimates don’t account for:

• Condition and upgrades

• Location nuances and school zones

• Lot quality or views

• Hyper-local market activity

Bottom line: The Zestimate is a starting point, not a sales strategy. Trusting it blindly can lead to pricing errors that cost sellers thousands and frustrate buyers looking for accuracy.

Zillow’s Legal Woes: A Sign of Bigger Problems

Zillow is facing multiple lawsuits, including:

1. Compass vs. Zillow – The “Zillow Ban” Lawsuit

Compass claims Zillow is engaging in anti-competitive practices by banning listings already published elsewhere, trying to monopolize exposure and control market behavior. This restriction limits seller visibility and agent marketing flexibility.

2. Class Action Lawsuit Over Unwanted Communication

Zillow has been accused of sending unwanted texts and robocalls, violating the Telephone Consumer Protection Act (TCPA). The lawsuit argues that Zillow’s lead generation is intrusive, misleading, and in some cases, relentless.

Zillow Flex & Paid Leads: The Flawed System

Zillow’s Flex and Premier Agent programs route leads based on who pays for them, not who knows the home.

This means:

• Buyers may be shown homes by agents who don’t represent the seller

• Sellers lose qualified leads because they’re funneled to agents who know nothing about the listing

• The real agent — the one the seller hired and who knows the property — gets bypassed

I’ve seen it personally. Buyers schedule a showing through Zillow for one of my listings — and Zillow assigns them an agent who can’t answer a single question about the home. It’s not just bad business, it’s deceptive and damaging to everyone involved.

The Value of Hiring a Seasoned Realtor

Now more than ever, experience matters. In a complex, fast-moving market — with confusing tech tools and questionable lead funnels — a trusted, local professional is your best asset.

Here’s why it matters:

• We know the market. Not just ZIP codes, but specific streets, neighborhoods, school zones, and trends.

• We know the inventory. Many of us know what’s coming soon, what just fell out of contract, and where the real value lies.

• We know how to price a home. Accurately. Strategically. Not off an algorithm, but with real data and market insight.

• We protect your interests. We guide, advise, and negotiate on your behalf — not Zillow’s, not the other agent’s.

A Positive Note — And a Better Option

This isn’t about tearing down Zillow.
It’s about lifting up what works — and why choosing the right agent makes all the difference.

At The Agency Oklahoma, we believe in real estate with integrity, experience, and excellence. We’re part of a global luxury brand that leads with heart, innovation, and local expertise. Whether you're buying, selling, or investing, you deserve a team that works for you — not a lead funnel.

Connect With Me

Wyatt Poindexter
Managing Partner | The Agency Oklahoma
📱 405-417-5466
🌐 www.TheAgencyOK.com
📧 [email protected]

Want a real opinion? Want real representation?
Let’s talk.