Zillow to pay shareholders $212.5 million in legal settlement

Nearly five years after shuttering its home-flipping business, Zillow has agreed to pay investors more than $200 million to settle claims that the company artificially inflated its stock price.

The Seattle-based real estate company disclosed in an SEC filing Wednesday that it agreed to pay $212.5 million to settle a class-action lawsuit, with $48 million of that to be paid through insurance.

The case centered around Zillow’s short-lived attempt at iBuying, an algorithm-driven form of house-flipping the company launched in 2018 and branded Zillow Offers. About three years later, the company announced that it would shutter Zillow Offers and lay off a quarter of its staff after failing to accurately project the costs of buying and selling homes in a hot housing market.…