Zillow plans to move 100% of its buyer connections to Preferred by mid-2027. Here's what that means for your business, whether you're in the program or not.
If Zillow is a big part of your team’s business, you’ll want to pay attention to this.
On November 4, Zillow confirmed some pretty big changes to how it distributes buyer leads.
By the first half of 2027, the company expects all buyer connections to go through Zillow Preferred, its invite-only, pay-at-closing program.
That’s a big shift from the traditional model of paying upfront for leads in specific ZIP codes.
And depending on how your team gets business today, it could change quite a bit.
Zillow shared three important numbers in its latest earnings announcement:
Under Preferred, teams receive Zillow connections without paying upfront, then pay a success fee when a transaction closes. Those fees currently range from 15% to 40% of the agent's commission, depending on the market and other transaction details.
And unlike the traditional ZIP code advertising model, access to those connections is tied to performance and eligibility.
In other words, the way you get leads from Zillow, what you pay for them, and how much control you have over your lead volume are changing.
It depends.
If you're already in Preferred: You may be in a great position. Zillow is putting more connections into the program, and strong-performing teams stand to benefit.
But it also means more of your business could depend on maintaining Zillow's performance standards and paying success fees on the transactions that result.
If you're still paying upfront for Zillow leads: Your current model is on its way out. Preferred is invite-only, and not every team is guaranteed a spot.
If your team doesn't make the transition, you'll need to think about where those future buyer opportunities will come from.
If you're already trying to diversify: This is another reason to keep going.
Because here's the thing.
Let's give Zillow some credit.
It's helped a lot of real estate teams build really successful businesses. And for plenty of teams, Preferred will continue to be an important source of business.
This isn't an argument to stop working with Zillow.
It's an argument to stop relying on any one company for too much of your growth.
Think about it.
What happens if your lead volume drops?
What happens if your margins get tighter?
What happens if the rules change again?
You can be a great Zillow partner and still want more control over your business.
Those two things aren't mutually exclusive.
Here's something worth thinking about: How many contacts are sitting in your CRM right now?
5,000? 20,000? 100,000?
How many of those people have you already paid to acquire?
And how many haven't heard from anyone on your team in months, or even years?
You've already invested in building those relationships.
But if nobody's consistently following up, there's a good chance you're leaving business on the table while paying to bring in more.
That's an expensive cycle.
Before worrying about where your next thousand leads are coming from, it might be worth asking how much business is hiding in the thousands you already have.
And if some of those contacts came from Zillow, it's worth understanding which ones are still subject to referral or success fees, and which ones aren't.
That distinction could make a meaningful difference to your bottom line.
Imagine a business where Zillow is one of several ways you generate opportunities.
Where your existing database consistently produces conversations and appointments. Where more of your website visitors turn into real relationships. And where your team isn't constantly hiring more people just to keep up with follow-up.
That's a pretty good position to be in.
Not because Zillow goes away.
But because your business doesn't have to depend on what Zillow does next.
Start by asking three questions:
You don't need to abandon what's working.
But you probably don't want to wait until it stops working to figure out your next move.
The best time to build more control over your business is while you still have options.
Fello helps you uncover opportunities in the database you've already built, while Felix turns those opportunities into real conversations for your team.
See how Fello + Felix can help you generate more business from the contacts you already have.