Home Bay is a discount real estate broker that offers reduced listing fees to home sellers in California.
But there are some pretty big tradeoffs:
Unlike other discount brokers, Home Bay makes you do most of the heavy lifting yourself. Customers typically get less than 90 minutes of contact with an agent.
Since Home Buy offers a process that's largely DIY, most home sellers will be able to find better service for the same price — or the same service for a LOT less.
What is Home Bay?
Home Bay is a discount real estate brokerage with licensed agents who can help you buy or sell a home in California. Somewhere else? Find discount brokers near you.
There are many differences between selling with Home Bay and a traditional realtor. The two biggest you should be aware of are:
- Price: Home Bay advertises huge savings compared to selling a house the old-fashioned way
- Service: Home Bay provides significantly less hands-on service and support compared to a traditional real estate agent
💡 What makes Home Bay different?
Unlike most real estate brokers, Home Bay focuses on its online platform, rather than providing in-person support. It's a tech startup first — and a real estate company second. Its priorities are evident in its legal name: Home Bay Technologies Inc.
» MORE: How does Home Bay work?
Home Bay also offers mortgages to all homebuyers in California; you don't need to purchase a property through the company to obtain a Home Bay mortgage.
Is Home Bay legitimate?
Yes, Home Bay is a legitimate, registered real estate brokerage brokerage. However, the company has gone through significant leadership turnover and appears to have shaky business prospects.
Leadership turnover and legal issues
For one thing, the company is on its second CEO in five years. And recent Glassdoor reviews of Home Bay complain of weak leadership.
In 2017, the State of California's Bureau of Real Estate filed an accusation against the company for not collecting commissions under its proper licensed name. The case resulted in only minor disciplinary action, but sheds negative light on Home Bay's management.
What happened to Home Bay's aggressive expansion plans?
We're also concerned by the fact that Home Bay hasn't become the tech disruptor that its investors had hoped for. The company has received more than $19 million in funding rounds earmarked for expansion but has instead shrunk in geographic scope.
Home Bay is shrinking rapidly — not growing
Home Bay Agents used to serve Colorado, Florida, Georgia, Illinois, and Texas. And in January 2019, CEO Ken Potashner reported planned expansion into as many as 20 additional states by the end of the year.
Not only did that growth not happen, but now the company has dwindled down to a focus on just California.
Home Bay is looking to sell its proprietary listing platform to other brokerage firms, perhaps in a way to make up for lost ground. The company paints a picture of a worrisome dependence on technology over customer experience and getting sellers the most money for their homes.
✍️ Editor’s note
We don't think Home Bay's business model is sustainable. Another brokerage we've reviewed, Faira Real Estate, used to bill itself as a tech disruptor but has since modified its business to include more human interaction and support after its listings started shrinking. We're concerned for the future of these businesses.
When you list your home, you want to have confidence that an agent is looking out for your best interests. We recommend exploring different options in the discount brokerage space.
How does Home Bay work?
Home Bay's business model is 100% technology based.
Sellers list on the Home Bay listing platform (plus the MLS, as with most other discount brokers). The platform then "walks" them through the listing process.
You won't meet your agent in person
Although you can call a dedicated agent, you'll NEVER meet in person, and they won't come to your home.
Offers are made and negotiated directly through the Home Bay platform.
AI will help you evaluate offers
The company's marketing states that its system "automatically red flags" potential "issues" in an offer. We're unsure if AI can be as attentive as an agent who knows your home and area well.
Sometimes there's just no substitute for expert professional representation in a huge transaction such as a home sale.
Don't rely just on AI to review offers on your home. At the very least, make sure to always carefully read the fine print — even if you're working with an agent.
How much does Home Bay cost?
Home Bay charges a flat fee to the seller that varies based on your listing price. Here's what you can expect to pay at different price points:
By using Home Bay, you can see significant savings compared to the 3% listing commission usually paid to an agent — though of course, keep in mind the significant difference in service.
📢 Watch out for Home Bay's upfront fees!
When you sign a 90-day contract with Home Bay, you'll be required to pay 10% of your fee up front. This is VERY unusual — even among discount brokers.
If you cancel your contract before 90 days, you'll forfeit your 10% deposit. If your home fails to sell within 90 days, Home Bay will refund the deposit back to you.
Don't forget about buyer's agent commission
Keep in mind that, as with all home transactions, in addition to the listing fee, you should expect to cover the buyer's agent commission. This typically costs 2.5-3%. But Home Bay allows you to decide yourself how much to offer.
Make sure to research average buyer's agent commissions in your area. If you offer a percentage that’s too low, agents might not feel compelled to bring their clients to your listing.
Home Bay vs. for sale by owner
Many sellers discover Home Bay while researching options for marketing their home “for sale by owner,” or FSBO.
FSBO is risky — but may be a better option than Home Bay
FSBO comes with its own risks:
- You need to be comfortable with a DIY approach
- It takes a lot of experience to manage a home sale successfully
Many FSBO properties fail to sell for many months before the sellers ultimately decide to list with a traditional real estate agent.
However, when FSBO works, it can save you a ton of money — significantly more than with Home Bay’s hefty listing fees.
Consider a flat-fee MLS service before you list with Home Bay
When listing a home for sale by owner, you don't need to handle the transaction entirely by yourself, either. There are a number of services that can help you market your home and even review the paperwork for just a fraction of Home Bay's price.
💰 Flat-fee MLS services offer BIG savings over Home Bay
Flat-fee MLS services can help you market a FSBO property and even provide extra services such as contract negotiation.
These services cost just a fraction of Home Bay's fee; our research indicates that typical rates for flat-fee MLS services in California are just $195-1,295.
» MORE: The BEST flat-fee MLS services in California
You could also hire a real estate attorney to handle the paperwork if that's the aspect of the sale you feel most uncomfortable with. (And in fact, some states other than California require a lawyer to be present at closing.) You can expect to pay as little as $150 per hour for such a service.
What if you want to save — but aren't comfortable with a DIY sale?
If you feel less confident handling a home sale yourself, there are options that offer the support of a full-service agent who will work with you in person for roughly the same price that Home Bay charges.
How does Home Bay compare to top alternatives?
Avg customer rating
4.5 (519 reviews)
4.9 (1252 reviews)
3.9 (395 reviews)
4.7 (583 reviews)
Dedicated point of contact?
1% or $3,000
1.5% (min fees vary by market)
1% or $5,000
*Average fee compared to a 3% commission at four price points: $100,000, $250,000, $500,000, $750,000.
Compared to other discount brokers, Home Bay looks like it could save you a ton of money.
However, when you compare its offerings with what you get from services such as Clever or Redfin, its price tag looks unappealing.
Home Bay offers MUCH less support than other discount brokers
Home Bay offers no in-person support — unlike the other brokers on this short list.
📢 Don't expect much facetime with a Home Bay Agent
According to Home Bay CEO Ken Potashner, customers get an average of 90 minutes of human interaction during their ENTIRE sale process. That's much less support than you can expect from a traditional agent.
Will you feel your needs have been met after only an hour-and-a-half of attention?
Sellers are expected to do the work themselves when they pay for Home Bay. The platform "guides" you along through the steps of a home sale. There's no experienced agent looking to get you the highest price for your home.
Our No. 1 piece of advice for anyone looking for an agent to list their home is to shop around and interview several realtors in your area.
Home Bay is comparable to MLS listing services — just a lot more expensive
On the other hand, if you're comfortable managing your home sale yourself — and don't want to pay a full-service realtor — you're probably better off using a flat-fee MLS listing service.
For a few hundred bucks, one of these services will:
- List your home on the MLS
- Give limited pricing support
- Provide downloadable contracts, disclosures, and other documents
Local MLS Listing
*Based on current median California home value of $610,000
Home Bay does offer a few services that flat-fee MLS listing companies don't offer, including: professional photos, yard sign, limited agent support, and an online platform to help you manage your sale.
However, considering that going the flat-fee MLS route will likely cost thousands of dollars less than Home Bay, you'll still come out ahead if you purchase any extra services you need a la carte.
Selling a house with Home Bay
On paper, Home Bay offers many of the same the services traditional agents provide:
Local MLS Listing
Listing with Home Bay might not actually save you money
However, although you'll save money on the listing fee, you might lose serious cash in the long run.
Remember: you'll never meet your Home Bay Agent in person. This means your agent can't give you the most accurate advice about important considerations like:
- Pricing your home
- Repairs and you should make
- Cosmetic improvements and staging
That could lead to getting a lower price than you deserve for your home or having your listing sit on the MLS for months because it's overpriced.
That could be a costly problem. Not only would you be paying carrying costs such as taxes, utility bills, and HOA fees, but buyers might become skeptical of a home that's been on the market for a long time. They might assume something is wrong with your property and even avoid making an offer if you lower the price later.
Be prepared to sign a 90-day contract — and pay up-front fees
When you agree to use Home Bay to list your home, you'll sign a 90-day contract and put down 10% of the flat-fee listing commission.
If you break your contract before 90 days, you'll forfeit your deposit money. However, if you don't sell your home with Home Bay and cancel after 90 days, you'll get your money back.
📢 Why Home Bay's upfront deposit is shady
We have suspicions that Home Bay might try to push home sales through within 90 days to keep the deposit cash. After all, the company claims 94% of sales are made in the first 90 days.
However you slice it, the 10% deposit is an unusual practice. Most brokers do NOT make you pay one cent in advance.
That said, fees for breaking contracts are common. The amount you could lose for breaking a Home Bay agreement could work out to about the same or even less than what other brokers would charge.
Always make sure that you do your due diligence and read the fine print before signing any kind of contract.
How good are Home Bay Agents?
Home Bay Agents are fully licensed realtors. They provide the same basic range of services as traditional real estate agents, although there are some BIG differences to watch out for.
Home Bay Agents have less direct incentive
One of the biggest differences between Home Bay Agents and traditional realtors is the compensation and incentive structure.
Home Bay Agents receive a salary. That's unlike traditional real estate agents who are paid commission and make money only when they have helped their clients sell their homes.
One agent told us that they also receive a bonus if you leave them a positive review. However, it's unlikely this bonus is as large as the commission traditional real estate agents earn.
💰 Realtor incentives matter!
A salaried Home Bay Agent just might not be willing to go above and beyond to get sellers top price for their homes. After all, they're on the clock and earn the same salary no matter how much your home sells for.
Plus, it's unlikely the top home-selling talent in your area is going to be working a salaried job. They're going to be competing to earn more money on a "pay for performance" model.
Home Bay Agents handle the ENTIRE sales process remotely
Home Bay can pay its agents less because sales are completely remote. All of your communication with your agent will occur via the listing platform or phone. And don't expect to receive white-glove, personalized care.
We recommend shopping around for an agent who will provide hands-on service and fight to get you the best price for your home.
If personalized service and support is a top priority, Clever can help. Clever’s agent-matching service not only connects you with local agents from major brands like Keller Williams, RE/MAX, and Century 21, but also negotiates low rates on your behalf.
Buying a house with Home Bay
The biggest advantage of using Home Bay to buy a property is the potential to earn a commission rebate.
💡 What is a home buyer rebate?
Many discount brokers and traditional agents alike will offer to kick a percentage of their fee back to a buyer as an incentive to work with them. This is commonly referred to as a home buyer rebate or commission rebate.
» MORE: What you should know about home buyer rebates
How does Home Bay's buyer rebate work?
Home Bay advertises that you'll receive 10% of the buyer's agent commission back at closing.
That sounds like a huge percentage at first glance. But framing it this way is a bit misleading.
Home Bay's rebate advertising is misleading
Most other discount brokerages that offer rebates advertise them as a percentage of the sale price.
Measured this way, Home Bay's rebate is really 0.25-0.3%, depending on the size of the buyer's agent commission. And it's quite a bit smaller than the commission rebates offered by other companies:
Home buyer rebate on a typical California home
Up to 0.3%
0.5% in Clever Cash Back
*Rebate size and savings based on the median CA home value of $610,000.
Note: home buyer rebates have numerous limits and restrictions.
Use caution when buying with a Home Bay Agent
When you buy a home with Home Bay, you'll be connected with what the company calls a "showing coordinator." The company isn't very forthcoming as to whether these people are licensed real estate agents or not.
The basic function of a showing coordinator is exactly what you'd expect: to show houses to prospective buyers.
Once you've found a home you wish to buy, someone else on the Home Bay team will help with negotiations, paperwork, etc.
Can you use a Home Bay showing coordinator to view a non-Home Bay listed house? And can you buy an "outside" house using the platform? The company doesn't make this very clear. In fact, its marketing message suggests the opposite.
However, we phoned a Home Bay Agent who informed us that you can use the company to view and purchase a non-Home Bay listed home. We take this as more evidence of Home Bay's confusing and disorganized business model.
Watch out for the 'Home Bay upsell'
Another risk of using Home Bay is the potential for an upsell.
We're concerned that Home Bay employees might pressure you to use Home Bay Financial's mortgage services.
Using a one-stop-shop for your home-buying and financing needs might seem convenient, but that's what discount brokers like Home Bay count on.
The products Home Bay offers might not be the best fit for you.
Remember: it pays to shop around when considering agents, mortgage providers, title companies, and so on, to find the best fit.
Home Bay reviews
Note: The following review information is up-to-date as of 10/6/2021. We will update this section as new information becomes available.
Customer reviews of Home Bay are a mixed bag. The company has an average rating of 4.5 across 519 reviews.
My Home Bay Agent made my sale 'easy' and virtually stress-free
This Home Bay reviewer reported a positive experience on Zillow. At the time, the reviewer was living on the East Coast and appreciated Home Bay's remote platform for selling a home in California:
'Stay away' from Home Bay
On the other hand, Zillow user FreyaMcKenna4 was less enthusiastic. She complained about terrible communication and warns others to avoid Home Bay "like the plague":
Home Bay is the 'absolute worst choice you can make'
Likewise, markcole5460 complained on Zillow about unresponsive agents and poor help when pricing their home:
Conclusion: Is Home Bay right for you?
Pros of using Home Bay
Cons of using Home Bay
Most of the discount brokers we've reviewed can be a better or worse choice depending on your situation. That's NOT the case with Home Bay.
Unfortunately, we can't recommend that anyone use Home Bay.
Home Bay costs as much as a discount broker. But most discount brokers provide full-service agent representation. Home Bay's limited level of support is a lot more comparable to a flat-fee MLS listing company — except Home Bay costs thousands of dollars more.
Home Bay's geographically shrinking business gives us pause too. The company had hoped to expand into nearly half of the U.S. by the end of 2019. One year later, its focus has narrowed to one — yes, one — state: California. This is compounded by evidence of mismanagement and poor leadership.
Selling a home is a high-stakes process. And most California home sellers have lots of options when it comes to saving on real estate commission. We recommend that you shop around. Look for the service or agent who is going to:
- Get you the best price for your home
- Make the experience as smooth and painless as possible
Interview agents who have experience and knowledge in your area and at your price point. You have absolutely nothing to lose (and everything to gain!) by shopping around and comparing rates, experience, and personalities to find the perfect fit.
Home Bay contact info and business hours
Home Bay's business hours
Home Bay's contact information
16950 Via De Santa Fe
Rancho Santa Fe, CA 92067
California Bureau of Real Estate. "Accusation Against HomeBay Broker CA, Inc." Accessed 10/6/2021.
Crunchbase. "Home Bay Technologies Crunchbase Profile." Accessed 10/6/2021.
Inman. "Tony Hawk says real estate agents will go extinct in Home Bay ad." Accessed 10/6/2021.