Houwzer Review 2020: How It Works, Pricing, Top Alternatives

By 

Katherine Peach

Updated 

October 28th, 2020

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Houwzer will list your home for a flat fee of $5,000. But its salaried agents might not fight to get you the best price for your home.

Houwzer is a discount real estate brokerage that offers many of the services you'd expect from a traditional agent — but with a few big differences.

When you sell your home with Houwzer, you'll pay a flat $5,000 listing fee, no matter the sale price. You'll also pay the buyer’s agent's commission, which Houwzer sets at 2.5%. Typically, the seller’s and buyer’s agents split a total commission of 5-6%.

Houwzer's business model — with full-time salaried agents and an online platform that handles many aspects of each sale — seeks to make Houwzer more efficient than the traditional real estate office, with the savings passed on to its clients. But there are potential risks here.

Houwzer employees might be less experienced than commission-based agents. They might also be less motivated to give sellers top service while earning them top dollar. After all, the agents are getting paid no matter what.

Your agent might also give you extra pressure to buy other services — like homeowner’s insurance or your mortgage — from Houwzer. Be sure to shop around and compare options, rather than taking the first choice your agent recommends.

Likewise, when choosing a realtor for buying or selling your home, you want to be sure you're selecting the best agent for your needs. It always pays to weigh your options and do your due diligence.

In this Houwzer review, we'll take a deep dive into the buying and selling experience. You'll learn what you need to know about the company, what alternatives you should consider, and what questions you need to ask before signing up with Houwzer.

Key takeaways

  • Houwzer is available only in Maryland, New Jersey, Pennsylvania, and Washington, DC, with a Florida branch coming soon. So if you don’t live in these areas, Houwzer won't be an option for you. Find brokers in your area.
  • Houwzer's flat fee can save you thousands of dollars compared to a traditional broker. But if you have a home priced $500,000 or less, you might save more money by choosing another discount broker.
  • Houwzer agents might be less experienced and less motivated to deliver a stellar experience than a traditional agent who is motivated to earn commission and customer reviews. Make sure to compare options and hire an agent you’re excited to work with.

What is Houwzer?

Houwzer is a multi-state real estate brokerage headquartered in Philadelphia. Since its founding in 2015, Houwzer has expanded into other major metro markets, including Baltimore, DC, and South Jersey. The company plans to open offices in the Orlando, FL area by the end of 2020.

Houwzer is what's known as a discount real estate brokerage. That means it advertises huge savings to sellers thanks to a commission model that varies from the typical 6% split between listing and buyer's agents.

Houwzer also offers mortgage and title services. The company plans to expand into homeowners' insurance later in the year.

Is Houwzer legitimate?

Yes, Houwzer is a licensed real estate brokerage in the four states where it operates. In addition, if you’re a conscious consumer who cares about the impact your dollars make, Houwzer may be worth a further look.

Houwzer is one of the few real estate companies to hold B Corp certification, indicating that it has met certain requirements for corporate responsibility and environmental sustainability.

Plus, Houwzer donates 2.5% of its profits to local charities and requires agents to spend at least 50 hours volunteering each year.

How much does Houwzer cost?

Houwzer charges home sellers a flat listing fee of $5,000. You'll also likely be on the hook for the buyer's agent commission, which is typically 2.5% of the final sale price. As with a traditional agent, you pay these fees at closing after your sale is complete.

Houwzer’s flat $5,000 listing fee could save you a lot of money — and the higher your home’s value, the more you save compared to a traditional “percentage of sale” realtor fee.

However, with a lower-priced home, Houwzer’s flat fee can actually work against you. If your home costs $175K or less, you may actually pay more with Houwzer than with a traditional agent.

Here's how Houwzer's flat listing fee breaks down as an effective commission rate at five different price points. For comparison, remember that the average listing commission ratenationwide is around 2.8%.

Price Point
Rate
Effective rate
$100,000
$5,000
5%
$175,000
$5,000
2.9%
$250,000
$5,000
2%
$500,000
$5,000
1%
$750,000
$5,000
0.67%

Of course, there’s a caveat to “higher savings at a higher price” — the pricier your home, the more you stand to lose if something goes wrong in the sale. Make sure to choose an agent who can net you the highest price, and not just charge the lowest fee.

Keep in mind, although the listing fee is discounted, you'll still need to pay a 2.5% commission to your buyer's agent.

Sellers offer a buyer’s agent commission to motivate buyer’s agents to bring their clients to see the home.

You want your buyer’s agent fee to be competitive with rates offered on homes in your neighborhood and price range, otherwise your home might get less foot traffic.

Typically, your listing agent will discuss and agree on a buyer’s agent rate before you list the home for sale. Houwzer, by contrast, fixes the buyer’s agent fee across the board.

Houwzer's mandated 2.5% buyer's agent commission is in line with current averages. However, be sure to research the typical rates in your area to make sure you aren’t underpaying or overpaying on buyer’s agent commission!

» MORE: What’s the average commission rate in my area?

Houwzer agents

Your experience with Houwzer depends primarily on the individual agent you work with. Above all, take the time to interview and compare agents from several brokerages to find the right fit.

Some Houwzer agents have extensive real estate experience, while others are brand-new to the industry. Houwzer job listings indicate that the requirements are a high school diploma and two years of experience working in an office. Theoretically, your agent could be a 20-year-old who spent two years answering phones in their dad's office!

Surveying consumer reviews of Houwzer, most sellers and buyers report excellent service with hardworking agents, but a few call out agents with lacking responsiveness and communication skills.

The biggest difference between Houwzer agents and agents from a traditional brokerage: Houwzer agents earn a salary instead of commission.

Typical agents collect no salary and are paid commission instead, meaning they only make money when they succeed in helping their clients complete transactions.

By offering a salary and benefits, Houwzer hopes to attract agents who want more stability, but they may also be less-aggressive, or less talented, than agents who choose to work on a strictly “pay for performance” model.

We've done some research comparing salaries advertised in Houwzer job listings with the average income for agents in Pennsylvania and the income of the top 10% agents in that state. Houwzer’s salaries are the lowest by far, which could impact the company's ability to attract and retain talented agents.

Annual Income: Houwzer vs PA Agents

Houwzer Agents*
$42,000 + bonuses
All PA Agents (Mean)**
$62,430
Top 10% PA Agents**
$100,460

**Data on income for Houwzer agents taken from Houwzer job listings.
*Data on income for PA Agents from the Bureau of Labor Statistics for May 2019.

When interviewing agents, consider their:

  • Experience in the specific neighborhood and price range where you plan to buy or sell
  • Past customer reviews and testimonials
  • Communication style and responsiveness
  • Estimate of your home’s value
  • And finally, the fees they charge, too!

You’re hiring an agent to handle what may be one of the biggest financial transactions in your life — it pays to take your time and find the right expert.

Unfortunately, that's difficult to do with Houwzer, which doesn't encourage agent-swapping.

When you sign up for Houwzer, the company will connect you with an agent representing your area. You must first meet with that agent and then decide whether you want Houwzer to make another introduction for you.

You can't just look at a website to find out the agent's qualifications or have a brief phone chat with a few different employees before deciding whether or not to use Houwzer.

Compare agents and save thousands

Try our free agent-matching service! Clever will get proposals from the top agents in your area — and negotiate discounted rates of just $3K or 1%.

How does Houwzer compare to top alternatives?


Houwzer
Clever
Redfin
Prevu
Avg Customer Rating
4.8 (1,007 reviews)
4.9 (550 reviews)
3.2 (283 reviews)
4.9 (81 reviews)
Dedicated point of contact?
Yes
Yes
Yes
Yes
In-person support?
Yes
Yes
Yes
Yes
Regions Covered
Mid-Atlantic
National
National
Mid-Atlantic, New England
Listing Fee
$5,000
$3,000 or 1%
1.5% (Min. fees vary by market)
1.5%Min. $7,500 (Philly)
Avg Savings*
$7,000
$7,375
$6,000
$3,563

Learn More
Learn More
Learn More
Learn More

*Average fee compared to a 3% commission at four price points: $100,000, $250,000, $500,000, $750,000.

Like the other discount brokerages in the comparison chart above, Houwzer offers full service. You'll receive one-on-one guidance and help from a dedicated agent (while an in-house team takes care of paperwork and marketing on the back end).

Unlike Redfin and Prevu, Houwzer charges a flat fee, rather than a percentage, for the listing agent's commission.

Here's how much you'd pay for listing a home in Philadelphia at various price points with four different discount brokerage services:

Price Point
Houwzer
Clever
Redfin
Prevu
$100,000
$5,000
$3,000
$3,000 (min.)
$7,500 (min.)
$175,000
$5,000
$3,000
$3,000 (min.)
$7,500 (min.)
$250,000
$5,000
$3,000
$3,750 (1.5%)
$7,500 (min.)
$500,000
$5,000
$5,000 (1%)
$7,500 (1.5%)
$7,500 (min.)
$750,000
$5,000
$7,500 (1%)
$11,250 (1.5%)
$11,250 (1.5%)

By our calculations, you would need to sell your home for at least $500,000 for Houwzer to be less expensive than Redfin, Prevu, or other discount brokers that charge 1-2%.

Clever's flat rate of $3,000 on houses priced below $350,000 makes it a better deal (plus, you'll receive full service from an experienced and non-salaried agent).

Prevu's $7,500 minimum for Philadelphia-area listings makes it more expensive than Houwzer, no matter how you slice it. But for homes priced below $500,000, Redfin and Clever are both better deals.

Houwzer is an even worse bargain than using a traditional agent if your property is at a low price point. You would need to sell your home for at least $170,000 to see any savings against the typical 2.5-3% listing agent commission.

At the $500,000 price point, both Redfin and Prevu would charge $7,500. Clever agents charge 1% for homes above $350,000, so the cost ($5,000) would be the same as with Houwzer.

On houses priced above $500,00, Houwzer can save you significantly compared to traditional agents, Redfin, Prevu, and even Clever. But are Houwzer agents experienced enough to handle top-dollar and luxury listings?

When considering a listing agent, make sure that the agent's experience matches your price point. You don't want to be anyone's first million-dollar home!

Connect with top local agents, save thousands!

Try Clever’s free agent-matching service today.

Selling with Houwzer

The experience of selling with Houwzer is similar to that of selling with a traditional agent. However, there are two key differences:

  • Houwzer offers built-in discounts on listing fees.
  • Houwzer's agents don't work on commission; they're full-time, salaried employees.

Houwzer agents receive a salary, as well as bonuses. They don't earn commissions.

That could have important implications for both home sellers and buyers.

Traditionally, real estate agents earn commissions, which means the more money they can sell a home for, the more they'll earn.

Houwzer agents earn the same paycheck no matter how much money their sales have earned.

By hiring salaried employees, Houwzer can ensure its agents are following standardized company procedures — making its operations efficient and cost-effective.

And in theory, salaried agents are less pushy than ones whose livelihoods depend on commission.

But if you're a seller, sometimes you want a pushy agent who'll fight to sell your home for top dollar.

Houwzer agents earn the same amount of money whether it sells for $200,000 or $300,000. For an agent working with the traditional 3% commission-based model, that would be a difference of $3,000.

Once you've decided to use a Houwzer listing agent, you'll sign a six-month contract (longer than with some other discount brokers we've reviewed).

A Houwzer agent informed me that sellers could terminate the contract at any time if they are unhappy with their service and not have to pay any penalty. However, before signing a contract, make sure that you read the terms carefully to ensure that this is indeed the case.

What services do you get when you sell with Houwzer?

Your Houwzer agent will personally take care of most aspects of the sale for you. There is an administrative team that handles paperwork, marketing, and accounting. Again, Houwzer says this is to help agents better focus on the sellers.

If you schedule an open house, a Houwzer buyer's agent will run it. We suspect this is so the buyer's agent can find prospective customers. Regardless of which agent your buyer uses, Houwzer prompts its sellers to offer a buyer's agent commission of 2.5%.

Buying with Houwzer

Buying a house through Houwzer is much like using a traditional brokerage. Your buyer's agent (who works only on the buy-side and doesn't list homes) will help you with house hunting, showings, preparing offers, paperwork, negotiations, and closing. There's no fee to use the agent (typically, the agent will be paid commission by the seller at closing).

The big difference is that Houwzer buyer's agents are salaried, full-time employees.

As a buyer, this could benefit you in two ways:

  • Your agent isn't incentivized to pressure you to pull the trigger and buy a home when you're not comfortable; they get paid either way.
  • Your agent's paycheck doesn't directly correlate to the home's final purchase price, which could motivate them to drive a harder bargain on your behalf.

Although the salaried-agent model might not be ideal for sellers, it may work out to be in buyers' best interests.

Does Houwzer offer a home buyer rebate?

People who both buy and sell with Houwzer receive either cashback or a discount on their listing fee. And there's no expiration for this offer, either.

Here's how it works: if you sell your house with Houwzer and then buy another house with a Houwzer agent at any time after that, you'll receive a $2,500 rebate. However, if you buy a home with a Houwzer agent and later decide to sell it (or another property) at any time after that, Houwzer will knock $2,500 (50%) off your listing fee. There's no expiration date on this offer.

» MORE: How do home buyer rebates work?

Although an effective listing agent commission of $2,500 for those who both buy and sell with the company sounds like a great deal, keep in mind that other discount brokers offer rebates without the requirement to sell.

Compare top buyer’s agents near you

Clever matches you with top agents in your area and helps you find the perfect fit. Qualifying buyers can even get up to 1% back at closing.

Houwzer's add-on services

Folks looking to buy a new home — or refinance their current one — might be interested in Houwzer's mortgage advisor service. This service can also help you find discounted rates from a variety of lenders and handle the application process for you.

And in 2018, Houwzer launched an in-house title company. The company is also preparing to roll out an insurance business later this year.

Using a one-stop-shop for buying a house, getting a mortgage, and having title work taken care of seems convenient. However, it's not always a guarantee of quality service.

Because many brokerages consider these services add-ons, they might not offer you the best price or value. The company is hoping that you'll go along with its in-house offerings just for convenience's sake.

Your home is one of the biggest purchases you'll ever make. It pays to shop around when considering mortgage providers, as well as title and insurance services.

» READ: A Step-by-Step Guide to the Home Loan Process

» READ: The Ultimate Guide to Title Companies

Houwzer reviews

Note: The following review information is up-to-date as of 10/28/2020. We will update this section as new information becomes available.


Rating
# of reviews
Weighted Avg
4.8
1,007
Zillow
4.9
611
Yelp
3.5
18
Facebook
4.8
135
Google
4.8
243

For the most part, customers report positive experiences using Houwzer for both buying and selling. But as with a traditional real estate agency, your experience will depend mainly on which agent you use.

Yelp user Sarah G. of Philadelphia used Houwzer agents to sell her first home and buy her next and had great things to say about their price value and hard work:

On the other hand, this Yelp user in Malvern, PA had a negative experience with Houwzer and felt that Houwzer’s business model didn’t incentivize agents to work hard for their clients:

When selecting an agent, the best thing to do is shop around. After all, selling or buying a home is one of the biggest transactions you'll ever make in your life. You want to feel confident that your agent is working their hardest for you.

However, Houwzer doesn't let you easily pick an agent from its stable. As mentioned above, the company requires you to meet with an assigned agent and then request another introduction if you're not happy.

If you’re planning to interview a Houwzer agent — or looking for alternatives — speak with Clever’s Concierge Team. Our licensed experts will match you with 2-3 top agents in your area, so you can compare marketing plans and find the agent best for you.

Compare top local agents, save thousands!

Try Clever’s free agent-matching service today.

Pros and cons of Houwzer

Pros

  • Houwzer's flat $5,000 listing fee can save you money, compared to the typical 3% commission that traditional real estate agents charge.
  • If you buy as well as sell a house with Houwzer, you'll save an extra $2,500 — effectively halving your listing agent's fee.
  • Unlike some other discount brokers, Houwzer offers a full-service buying and selling experience.
  • Buyers can also take advantage of Houwzer's in-house mortgage brokerage.
  • According to my contact at Houwzer, there's no penalty if you decide to terminate your six-month seller's contract.
  • Houwzer handles all of the standard marketing services, including creating flyers and listing your property as a "featured listing" on Zillow, Realtor.com, and Trulia.

Cons

  • If your house sells for less than $170,000, you'll actually lose money when you list with Houwzer vs. a traditional real estate agent.
  • Salaried agents could be less motivated to sell your home for top dollar.
  • There are no savings or rebates for buyers unless they also sell their homes with Houwzer.
  • Sellers might not want to work with buyers who are represented by a potentially inexperienced Houwzer agent.
  • Houwzer makes it difficult to interview and pick among its agents.
  • If your buyer uses a Houwzer agent, you'll still need to pay a 2.5% commission to the buyer's agent's office. Some other discount brokers eliminate this commission under similar circumstances.

Conclusion: is Houwzer right for you?

As we've seen, Houwzer offers a full-service buying and selling experience but for a flat fee of $5,000. While that might be an excellent bargain for some home sellers, others might actually lose money by using this real estate broker.

Houwzer might be a good fit for you if:

  • You want to sell your home for $500,000 or more to get the most savings from the flat fee.
  • You're looking to both buy and sell a house (you'll get that extra $2,500 off).
  • You want a full-service real estate agent.

Houwzer might not be right for you if:

  • Your house will likely sell for less than $170,000; at this price point, a traditional agent would actually be cheaper!
  • You want only to buy, not to buy and sell.
  • Your property is distressed or in an undesirable location. Because of Houwzer's salary model, listing agents might be less willing to pull out all the stops to market (or help you improve) a property that's less than perfect.

The important thing to remember is that there’s no obligation to move forward or commit when you’re interviewing different real estate agents or services.

You have absolutely nothing to lose and everything to gain by shopping around and comparing rates, experience, and personalities to find the perfect fit.

Next Steps: Talk to an expert!

If you're looking to buy or sell a house and weighing your options, Clever can help!

Our fully licensed Concierge Team is standing by to answer questions and provide free, objective advice on how to get the best outcome with your sale or purchase.

Ready to get started?

Give us a call at 1-833-2-CLEVER or enter your basic info below. Our Concierge Team will be in touch shortly to help.

Remember, this service is 100% free and there’s never any obligation.

Houwzer locations, contact information

Greater Baltimore

Anne Arundel County
Baltimore City
Baltimore County
Howard County
Carroll County

Greater Washington, DC

Arlington County (VA)
Manassas Park, VA
Fairfax County (VA)
Montgomery County (MD)
Falls Church (VA)
Prince George’s County (MD)
Loudoun County (VA)
Prince William County (VA)
Manassas, VA
DC Metro Area

Greater Philadelphia

Bucks County
Chester County
Delaware County
Montgomery County
City of Philadelphia

South Jersey

Most of Burlington County
Most of Camden County
Some of Gloucester County

Houwzer's business hours

Monday-Friday
9-5 ET
Saturday
10-2 ET

Houwzer's general contact information

Phone
(215) 876-2876
Email
support@houwzer.com