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A report released on Tuesday by the Consumer Policy Center suggested lawsuits will follow if brokerages, real estate portals and regulators don’t step in and add transparency first.

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Consumers should know whether the agent they’re working with is paying a referral fee as part of a transaction, according to a new report released on Tuesday by the Consumer Policy Center.

The report, written by Stephen Brobeck and Wendy Gilch, concluded that there isn’t enough transparency or enforcement of existing rules around whether, when and how referral fees are being disclosed to consumers.

The real estate portals that have honed their money-making lead-generation processes also have a role to play in making things clearer for consumers, the report said.

“Before signing any agreements, buyers and sellers should receive clear disclosures both from referral companies then later from agents about referral fees, most importantly, that they are being paid by a buyer agent to a referral company,” the report said. “The specific amount of the fee should also be disclosed.”

The report comes as the industry has circled around the concept of referral fee disclosure amid a time of intense focus on giving consumers choice in real estate transactions.

In November, a governing group within the National Association of Realtors rejected a proposed change to the Realtor Code of Ethics that would have expanded the requirement for Realtors to disclose to clients when they or their companies receive any compensation or fees from a referral.

Several major brokerages and Realtor associations have since moved to enact their own disclosure requirements. But more work must be done, according to the new report.

“Referral fee services can be especially harmful to buyers and sellers if the fees are high,” the report found. “High fees reinforce high commission rates, jeopardize the quality of consumer service, and are associated with deceptive practices.”

The report focused, in part, on the adaptation in recent years of the real estate search portals that have leaned into success fee models, where agents pay only after closing a transaction.

“While several of the larger companies, including Zillow and Realtor.com, offer subscription services with monthly fees, all now emphasize per-sale referral fees,” the report said. “From an agent’s perspective, many agents are more willing to pay a percentage of their earned commissions rather than monthly marketing fees that guarantee no sales.”

The system does mean that consumers are likely to work with successful agents. The money the referrals provide to the major portals also allows the companies to provide consumers with a broad array of homes on the market.

“However, individual consumers who work with commission-based referral companies, especially buyers, also face risks and costs,” it added. “The most important is a non-negotiable 3 percent commission rate related to the 30-40 percent referral fee. That high fee, in turn, jeopardizes quality of service and also is associated with deceptive marketing practices.”

The report used anecdotal evidence that it said suggested referral rates drove up commissions.

In its response, Zillow suggested the report relied on little evidence.

“This report has little to no evidence for its claims, often relying on comments posted anonymously on social media instead of verified sources,” the company said in a statement. “Where the authors get it right, they point to Zillow’s emphasis on providing potential homebuyers with connections to high-performing agents, and to the benefits of these referrals to agents themselves.”

When the researchers asked referral companies, including the major portals, for buyer agents, they typically received the names of multiple agents.

“But in November 2025 when we contacted the three portals about a specific property, we were referred to only one buyer agent,” the report said. “That agent had a special relation to the company as a Zillow Premier agent, as a Realtor.com Concierge agent, or as a Redfin employee or partner agent.”

Such a filter “limits meaningful consumer choice,” the report says.

“It is important that any contact buttons specify whether buyers will be referred to a buyer agent or listing agent,” it adds. “It is also important that home listings provide clear and equal opportunities for a buyer to contact either.”

If the industry moves to beef up referral disclosure, it should apply to the leading real estate portals, the report said. If not, lawsuits may follow.

“Questions have been raised as to whether these required disclosures would also apply to referral agencies, especially Zillow, Realtor.com, and Redfin,” it said. “They should be, and if state legislatures or regulators do not act, the issue may be resolved by litigation.”

Inman has reached out to the real estate portals named in the report and will update this story with additional comments, if any.

Email Taylor Anderson

Topics: NAR | Realtor.com | Redfin | Zillow Show Comments Hide Comments Sign up for Inman’s Morning Headlines What you need to know to start your day with all the latest industry developments Sign me up By submitting your email address, you agree to receive marketing emails from Inman. Success! Thank you for subscribing to Morning Headlines. Read Next