Compare Zillow Flex and Orchard

For Sellers

Referred Agents
25%-40%
Referral Fee
Zillow Premier Broker program does not provide real estate services to home sellers. Instead, this program matches consumers with various real estate agents in exchange for a 25%-40% referral fee. Zillow Premier Broker results suffer from pay-to-play bias because the network does not match consumers with agents unwilling to pay a significant part of their commission.

For Sellers

List and Move First
5% to 6%
Listing Rate
Minimum commissions and other terms may apply. Buyer's Agent Commission (2.5%-3%) is included in 5% to 6% fees whenever Orchard acts as a dual agent, otherwise 2.5%-3% BAC is offered to the Buyer Agent via MLS. Move First program allows home seller to buy a new home before lisitng thier current home on the open market. Orchard also offers a Guaranteed Offer to home sellers, but HomeOpenly does not recommend taking this option due to high losses of equity.

For Buyers

Referred Agents
25%-40%
Referral Fee
Zillow Premier Broker program does not provide real estate services to home buyers. Instead, this program matches consumers with various real estate agents in exchange for a 25%-40% referral fee. Zillow Premier Broker results suffer from pay-to-play bias because the network does not match consumers with agents unwilling to pay a significant part of their commission.

For Buyers

Buy with Orchard
0%
Buyer Rebate
Minimum commissions and other terms may apply. Buyer's Agent Commission (2.5%-3%) is typically received by Orchard from a home purchase, but this may differ on an individual sale. Orchard further make a cash-backed offer as an added value as part of their buyer agent services.
Question: What is the difference between Zillow Flex and Orchard?
Answer: Zillow Flex is a referral fee network that enables broker-to-broker collusion with use of blanket referral agreements while Orchard is a full-service real estate agent and a stand-in cash program for buyers that offers savings to homebuyers and home sellers
Compare Zillow Flex and Orchard for home buying and selling. HomeOpenly is an impartial and an open resource focused on trending real estate services, portals and start-ups.

First published: 17 March 2022
Last updated: 17 March 2022

Buying and Selling with Zillow Flex

WARNING: Unlawful Kickbacks, Broker-to-Broker Collusion, False Marketing, Wire Fraud, Price Fixing.

Zillow Flex is a broker-to-broker collusion scheme, where "partner agents" unlawfully agree to pay massive kickbacks to receive your information and engage in market allocation, consumer allocation, false advertising, unlawful kickbacks, wire fraud, and price-fixing practices in violation of, inter alia, 18 U.S.C. § 1346, 18 U.S.C. § 1343, 15 U.S.C. § 1, 15 U.S.C. § 45, 12 U.S.C. § 2607, 12 C.F.R. § 1024.14. As a consumer, you will always significantly overpay for Realtor commissions subject to hidden kickbacks and pay-to-play steering promoted in this scheme.

United States federal antitrust laws prohibit consumer allocation and blanket referral agreements between real estate companies.

Be smart; do not allow your information to be "sold as a lead" to a double-dealing Realtor in exchange for massive commission kickbacks paid from your future home sale, or your future home purchase.


Zillow Flex is a real estate referral fee network that is designed to collect undisclosed referral fees from real estate agents. Within this network, Zillow Group screens and refers consumers to real estate agents with a pre-existing "blanket" referral agreements. Zillow Group refers to this referral service as a Zillow Flex because it allows brokers to participate without paying any upfront costs to Zillow Group.

As a consumer filling out a contact form on the Zillow-owned (Zillow, Trulia, etc.) web site, "you authorize Zillow to make Real Estate Referral and acknowledge Zillow may be paid valuable consideration for facilitating such referral." Zillow Group does not disclose to consumers how much "valuable consideration" it receives from participating brokers. "The established referral fees are specific to each market in order to account for local pricing trends," according to Zillow.

Zillow Flex is a form of pay-to-play consumer brokering product that relies on the use of blanket referral agreements to pay for each referral. Blanket referral agreements between brokers are a per se violation of the Sherman Act. With Zillow Flex consumers are effectively pre-screened by Zillow and “sold as leads” to whoever is willing to pay for this information with a share of their commission.

Zillow Flex Pricing

Zillow Premier Broker does not offer paid services to consumers directly, instead, the portal generates revenue with estimated 25%-40% referral fees from real estate brokers. Zillow Group declines to disclose the exact fee amount.

Listing Services

  • This Service Does Not Represent Sellers

Buyer's Agent Services

  • This Service Does Not Represent Buyers

Zillow Flex Editor's Review:

This review is focused on the Zillow Flex program only. Two separate reviews are assigned to Zillow Instant Offers and Zillow MLS aggregator programs. Since Zillow was first founded, it has idolized itself as a real estate Internet company. However, with an introduction of Zillow Flex in 2018, this is no longer the case.

Today, Zillow acts as a "paper" real estate broker. This fact allows Zillow to receive referral fees from real estate agents across the United States.

Zillow operates under the following real estate brokerage license in the following States:

Arizona CO580407000
California 01522444
California 01980367
Colorado 100080923
Florida CQ1058944
Georgia 76885
Minnesota 40638657
Nevada B.1002277.CORP
North Carolina C30388
Texas 549646
Washington 21212
Wisconsin 835987-91

Real estate agents are allowed to pay one another referral fees with a narrow RESPA provision that is needed to allow individual agents to refer business to other individual agents outside their service area. Despite being registered as a broker, Zillow does not perform real estate services, it simply sends leads to specific agents within its network and uses a real estate license to collect a back-loaded referral fee in the process.

Referral fee revenue is 32x that of a regular advertisement revenue because it results in an economic process called reverse competition, where consumers suffer from elevated costs and lower service as a result. A referral network is anything but free.

The following are some telling quotes from Zillow itself and a Premier Broker program participants. These words speak for themselves.

  • "We receive listing and buyer referrals directly from Zillow's Premier Broker concierge services. These leads have been scrubbed and vetted before they are directly handed off to you." Source: Sonoma County RE/MAX Marketplace, Zillow Flex participant.
  • "We will validate all leads first, then send agent-ready buyers to you." Source: Zillow website.
  • "What happens if you miss a call? Don't worry. You won't lose your place in the queue and we will call you with the next connection we validate." Source: Zillow website.

Zillow Group does not disclose the exact amount in referral fees it collects from Premier Brokers, aside from stating that it is an "industry standard." Similar referral fee networks typically receive 25%-40% of the agent's total commission. This is a good reference for the amount in commissions consumers can expect to overpay for their real estate services with a Premier Broker. Zillow Flex is a pay-to-play process that harms the industry as a whole and makes buying and selling homes more expensive.

Why does the Zillow allow for such poor UX? There are thousands and sometimes tens of thousands in fees collected from each transaction effectively hidden in consumer’s commission.

Consumers in the United States have been systematically conditioned to a 6% "standard" commission structure, a non-negotiable fact that needs no justification. Unfortunately, this inefficiency alone breeds uncompetitive behavior where real estate agents can easily pay tens of thousands in fees because they are recoverable with a high commission.

Consumers are truly forgotten in this model as an afterthought. When these exigent commissions are amortized over the first five years of homeownership, these fees are the highest single expense line-item - more than the insurance, more than the interest, more than utilities. Clearly, real estate agents only sign-up with Premier Broker because the price of the referral fee can be easily incorporated into their client's agreement with excessive commissions.

RESPA allows for an exception for real estate agents if and only if “all parties are acting in a real estate brokerage capacity" so that individual agents can refer each other when they are out of the local area. This exception has now been turned up-side-down where a referral network does not act in the capacity of a real estate broker. Zillow Group simply uses a license to collect fees without any tangible services done as defined by said license.

Consumers looking to work with a legitimate real estate agent on fair terms should absolutely avoid Zillow Flex and never release their full name, email and a phone number to Zillow Group.

The issue of having all US residential real estate markets heavily subjected to these schemes results in noncompetitive behavior, higher costs to consumers and lower quality of service. Having agents "commonly" pay networks 25%-45% of their commission is the true reason why real estate is broken.

Zillow Group matches consumers with "great, amazing, top-producing, perfect agents" based on who first picks up the phone and who is willing to kick in a chunk of their commission, this is the main basis for this process.

What happens when this flawed revenue model is no longer sustainable due to competitive commissions entering the market? The next stage of real estate innovation will have to account for this reality. In play are now competitive open rates, flat fees and buyer’s refunds from highly qualified real estate agents.

Transparent commission rates will eventually bring and end to a pay-to-play phenomenon in the real estate process where programs like Premier Broker simply cannot exist.

Today, consumers should be careful and only negotiate with agents that have no referral fee agreements signed, this is the only way to negotiate for full service at a market rate.

Where does Zillow Flex operate?

Zillow Flex currently operates in select areas across Fort Collins, CO, Pueblo, CO, New Haven, CT, Norwich, CT, Phoenix, AZ and Atlanta, GA..

Buying and Selling with Orchard

2022 Editor’s Score Update: Orchard (formerly known as Perch) is a VC-backed real estate company headquartered in NY that has recently pivoted (changed their business model) from what used to be an iBuyer to what is now a bridge loan Fintech-assisted home buying and home selling.

This is a positive business model change that has organically improved the Editor’s score for Orchard on HomeOpenly platform with an updated Editor’s review for this business. The archived version of the previous Editor’s review for Orchard is available here. HomeOpenly Editor’s Score is adaptable to businesses in the US housing sector either improve or degrade their service offerings to consumers. An organic imporvment in HomeOpenly Editor’s score is a sign of companies’ willingness to improve their practices. When companies improve their practices, HomeOpenly Editor’s Score organically follows.

HomeOpenly Users’ Reviews for Orchard are published in accordance with Consumer Review Fairness Act and fair marketing and advertising principles. HomeOpenly never removes legitimate Users’ Reviews posted by consumers. However, we recommend that consumers reference newer Users’ Reviews posted. Some older Users’ Reviews for Orchard posted by consumers may no longer reflect upon Orchard’s current real estate and Fintech bridge loan services.

Orchard Pricing

Orchard primarily makes money with real estate commissions, but also with a difference between buying and selling each home when a home seller accepts a Guaranteed Offer. Sellers can expect to receive 80%-85% of their home value from Guaranteed Offer type of sale after any fees, cost of the minor repairs, and resale. As a Fintech-enabled Listing Realtor, Orchard Realty charges Move First fee (the same as List with Orchard fee) at 5% to 6% of your home sale (where Orchard acts as a dual agent and collects the 3% listing fee plus the 3% BAC Buyer Agent Commission.). Buy with Orchard fee is paid from the BAC Buyer Agent Commission typically offered via MLS at 2.5% to 3% to buyer agents. When acting as a buyer agent, Orchard does not offer any rebates from the BAC amount it receives, but the service includes Orchard's cash-backed offer as an added value (when compared to buying the same home with another buyer agent who does not offer rebates to buyers.)

Listing Services

  • MLS Listing
  • Zillow, Trulia, etc. Listing
  • Accept and Deliver All Offers and Counteroffers
  • Hold Open Houses
  • Professional Floor Plans
  • Yard Signage Installation
  • Spare Key Lock-box Installation
  • Schedule Inspection Services
  • Schedule Private Showings
  • Closing Duties
  • Professional Photography

Buyer's Agent Services

  • Find the Property
  • Accept and Deliver All Offers and Counteroffers
  • Recommend Other Professionals
  • Attend Inspection Services
  • Schedule Private Showings
  • Negotiate Needed Repairs
  • Closing Duties

Orchard Editor's Review:

Move First and Home Listing Services

Orchard Brokerage offers home sellers a Fintech-enabled buy before listing Move First bridge loan option in certain areas where it operates. This program is potentially a value-added service for consumers where a home seller can list their home for sale after they buy another home and move into a new property. This program is not free, and home sellers must be aware of program specifics to fully understand if this is the right option for your case. The Editor's review examines the program based on the cost vs benefit, as well as the available alternatives to home sellers.

The one critical difference in this program is that Orchard offers two separate (and business-wise unrelated) services to home sellers as “tied” into a single offering: (1) service of a real estate listing agent and (2) service to produce a bridge loan between two mortgages.

This tied notion is important because it directly affects the home selling fees associated with using Orchard compared to an alternative real estate service that may offer home sellers lower costs of real estate commissions and/or an alternative Fintech-enabled bridge loan program that may offer an untied bridge loan on better terms. Home selling fees (Realtor commissions) are the biggest single line-item expense in real estate transactions.

For example, let’s examine the 6% commission rate currently advertised for Move First service (if Orchard acts as a dual agent and collects the 3% listing fee plus the 3% BAC Buyer Agent Commission.) On a $4 million home sale, the total 6% gross commissions taken by Orchard amounts to $240,000. This is the amount of equity a home seller would need to convert into fees to pay Orchard for their service, and a buyer to pay for out of his/her new mortgage sum. How Orchard advertises these fees becomes very important in a competitive real estate market where competing Realtors may offer much lower listing fees or similar fees for very different services rendered.

For a home seller, it is important to shop for listing broker commissions because of the significant difference between net equity and total equity left after a home sale. The bank does not care how much in fees are lost during a sale, only homeowners’ net equity is lost in transaction fees. Remember, every dollar in net equity from a home sale is paid for with years of mortgage interest, insurance, taxes, and other life-cycle costs.

Buyer Agent Services

For home buyers, Orchard offers the services of a buyer agent supported by cash-backed offers. This bridge loan program is not free for buyers, it is a product of high interest in a short period, paid for with fees. In Orchard’s case, these fees are BAC Buyer Agent Commissions offered on MLS. However, unlike cash iBuyers that drain equity, the premise of a bridge loan cash leverage is to improve the outcome of the real estate transaction with a more reliable offer made by the home buyer, backed by rapid access to someone else’s cash. This distinction allows a buyer to use Orchard’s VC cash vault to secure a home purchase on better terms.

The purpose of the cash-backed offers benefits the home buyer, but this program also places the home buyer into an agreement with Orchard where the home buyer may face fees and penalties for backing out of the deal, as well as limited acceptance into the loan program based on home buyers’ financial standing, location, home value, and other situational requirements, etc. Orchard does not currently publish specifics for these terms anywhere, and it does not disclose the acceptance rate into the program. This is not a regular loan product, thus it largely remains a black box. It should be noted, however, that this is a universal issue with any similar Fintech bridge loan product because the program must assume that a home buyer is able (and likely) to secure a mortgage.

The home buyer pays for the bridge loan product because it is coupled with the Buyer Agent Commission (BAC) that Orchard receives from the home purchase. This amount is offered on MLS, typically at 2.5% to 3% of the home sale price. Some of Orchard’s competitors offer rebates from this BAC amount as a way to compete for home buyers' business. For example, on a $4 million home purchase, Orchard Brokerage receives about $100,000 as a Buyer Agent Commission (BAC) amount. If a competing brokerage offers a home buyer on that same sale, a 50% rebate that is a $50,000 tax-free cash in the home buyer’s bank account (this is typically subject to lender approval and only in 40 US States and Washington DC. Ten (10) US States currently maintain anticompetitive state bans on buyer rebates.) This potential cash rebate is the opportunity benefit that a home buyer gives up to use Orchard Brokerage to represent them with a bridge loan program. Is the buyer rebate better or is the bridge loan better? This is up to each home buyer to decide, but either one of these options holds an inherent value.

Guaranteed Offer

Orchard was born as an iBuyer, but the company has since shifted its business model to a Fintech-enabled Realtor. iBuyers systematically make below-market offers to home sellers, at about 80% of the true open market value when adding together the lower priced offers and the exigent fees.

For example, Orchard claims that their fees to take the Guaranteed Offer is 7% of the home value, but that does not include the hidden fees of below-market offers made to home sellers. Orchard Guaranteed Offer may seem like a good idea to a home seller, but it is probably the worst equity drain there is. Remember, a mortgage company does not care how a home seller sells their home – they receive the same remaining mortgage sum amount regardless if a home seller has lost 20% of their equity or 2% of their equity in real estate transaction fees. A 20% loss in total equity easily translates into 90% of net equity the home seller has in their home. Transaction fees in real estate are often hidden from home sellers because they are paid out from the mortgage sum, but this money is very real when it comes to the remaining net equity after the sale.

iBuying suffers from “double transaction” costs and ultra-high risks of buying and reselling a home on the open market. iBuying is systematically the most expensive way to transfer ownership of real estate in the United States. The best way for consumers to transfer real estate is on the open market, subject to competitive commissions and fees.

When Orchard Brokerage acts as a home sellers’ primary listing agent and a representative, it creates a conflict of interest by offering their client an offer on their home that the company knows is below the market price. By tying the service of a self-serving iBuyer and a service of a Realtor into a single proposition is a serious conflict. Selling directly to Orchard should be the sellers’ last resort option. Even Orchard itself admits that this program is a statistical UX failure where 95% of their customers do not choose to sell to Orchard. Orchard claims that the Guaranteed Offer helps to protect the seller, but the true cost of accepting a below-market iBuyer option makes their claims statistically unsupported. Either way, a consumer would need to hire another Realtor to help them evaluate the Guaranteed Offer from an unbiased perspective, where Orchard Brokerage cannot be trusted to make such determination in self-interest. iBuyers do not have a duty to represent home sellers, they only have to represent their balance sheets and shareholders.

Neutral Rating for Orchard

HomeOpenly Editor’s rating for Orchard is Neutral. First of all, Neutral is not a bad rating on HomeOpenly - it is Neutral. The main aspects of the Orchard services offer added value to consumers as a Fintech-enabled real estate brokerage, a bridge loan, and an inclusive home listing repairs and home staging Concierge. At the same time, some of the Orchard practices should give consumers a pause to think.

Orchard has already made a great effort to primarily switch their model from an equity-drain product of an iBuyer to use VC cash as leverage to help consumers, which means that the company is willing to improve its services. As always, Orchard’s customers are encouraged to share personal feedback as the ultimate gauge of service and value with any sentiment.

Where does Orchard operate?

Orchard currently operates in select areas across Austin, TX; Dallas-Fort Worth, TX; San Antonio, TX; Houston, TX; Denver, CO; Atlanta, GA; Charlotte, NC; Raleigh-Durham, NC; Montgomery County, MD; Northern Virginia.