If you're trying to save on commissions, you'll run into two options that sound alike: discount brokerages and flat-fee brokerages. They're not the same thing, and the difference matters more than the headline price.
What a discount brokerage is
A discount brokerage still charges a percentage, just a smaller one, often 1 to 2 percent instead of 2.5 to 3. Some are good. Many cut service to match the price, which can mean:
- Less agent time, or a different agent at each step
- Limited marketing, or marketing as a paid add-on
- Little help with negotiation or escrow
- A percentage that still rises with your home's price
The fee is lower, but the structure is the same. The agent still earns more when the price goes up, and a smaller cut can mean less attention per client.
What a flat-fee brokerage is
A flat-fee brokerage charges a fixed dollar amount no matter what the home sells for. At Arrivva, that's $9,750 to buy and $15,750 to sell, with full service included.
For sellers, that means pricing strategy, inspections paid up front, professional photography, Matterport 3D tours, floor plans, MLS and major-site syndication, and negotiation handled by the broker. For buyers, it means full representation, a fully underwritten preapproval, and the rest of the buyer-broker fee back as a rebate at closing.
Side by side
| Flat fee (Arrivva) | Typical discount brokerage | |
|---|---|---|
| How you pay | Fixed dollar amount | Reduced percentage |
| Fee on a pricier home | Same | Goes up |
| Service level | Full service | Often reduced |
| Paid more for a higher price? | No | Yes |
| Dual agency | Never | Varies |
Not every flat-fee company is full service either. Some advertise a low flat fee and then add charges, or offer only an MLS listing. Read what's included.
The questions to ask either one
- What exactly do I get for the fee? Get it in writing, item by item.
- Does the fee change with the price? If it does, you're still paying a commission.
- Who negotiates for me? A licensed broker, an agent, or nobody?
- What costs extra? Photos, inspections, showings, transaction fees.
- Will you ever represent both sides? If the answer is yes, keep looking.
The bottom line
A discount on a percentage is still a percentage. A flat fee changes the incentive. When the fee is the same at any price, the only job left is getting you the best deal.
Want the full breakdown? Read Flat Fee Real Estate: The Future of Buying and Selling Homes.