Compare Aalto and HomeStory
For Sellers
For Buyers
For Buyers
Answer: Aalto is a listing real estate agent that offers savings to home sellers while HomeStory is a referral fee network that enables broker-to-broker collusion with use of blanket referral agreements
Selling with Aalto
Aalto is a California savings tech-enabled broker (California DRE 02062727) that offers consumers listing savings for select areas around San Francisco Bay Area. Aalto claims that it does not list homes on the MLS (and, subsequently, these homes are not shown on MLS aggregators, such as Zillow, Trulia, etc. or on the competing brokers’ websites such as Redfin.) During our research, however, we found that at least several listings are listed by Aalto agents on the MLS, making it unclear why the brokerage lists some homes on MLS and not others, or how the brokerage complies with local MLS rules.
Listing homes off-MLS has potential disadvantages to home sellers. Buyers are systematically searching open MLS listings for new homes, which is the whole reason why MLS exists. Selling a home off-MLS (also known as pocket listings) is a conflicting practice because, naturally, it excludes a large number of potential buyers from looking at sellers’ homes.
If a property is not listed on the MLS, the listing agent or brokerage is more likely to represent the buyer, a situation that is often defined by state law as “dual agency” representation. Dual agency must typically be disclosed, and it’s up to buyers and sellers whether they want to engage in a dual agency transaction. Some sellers don’t mind getting less money if they can sell a home privately, but statistically speaking, there are little to no advantages to listing homes off-MLS.
Aalto Pricing
Aalto offers savings to sellers (1% listing fee). Aalto does not advertise buyer’s refunds and does not offer consumers buyer representation services. Instead, Aalto claims to connect potential home buyers to “partner agents,” likely receiving 25% to 35% as a kickback from the Buyer Agent Commissions (BAC.) Aalto likely keeps the entire Buyer’s Agent Commission when it represents home buyers, but sellers can determine what buy-side commission they offer (normally 2.5%). In the event Aalto acts as a dual agent, the total fee it likely receives is 3.5% (1% listing fee plus 2.5% BAC)
Listing Services
- Off-MLS Listing
- Pocket Listing
- Accept and Deliver All Offers and Counteroffers
- Hold Open Houses
- Professional Photography
- Yard Signage Installation
- Spare Key Lock-box Installation
- Schedule Inspection Services
- Schedule Private Showings
- Closing Duties
Buyer's Agent Services
- This Service Does Not Represent Buyers
Aalto Editor's Review:
Aalto is a tech-enabled listing real estate agent that represents consumers in select areas of Northern California and offers sizeable savings (1% listing rate against 3% listing commission, excluding BAC) to sellers. Aalto's service includes posting home on their website as an off-MLS listing, professional photos, and 3D images in addition to some typical services offered by a traditional real estate agent. It is unclear if and how many open houses Aalto agents typically hold.
Overall, Aalto offers a questionable off-MLS proposition to sellers, and the company does not openly advertise any savings and tangible services to buyers (other than a blanket buyer agent referral.)
Aalto argues that pocket listings are perfectly legal and serve the needs of many sellers in today's residential markets, against opponents who raise open market, fiduciary duty, and fair housing concerns.
Pocket listings (also known as "quiet" or "off-market" listings) involve the practice of withholding residential listing data from multiple listing service (MLS) systems. Instead, the property is marketed by Aalto brokerage using its website, to existing clients, and new prospects that happen to look there. The practice typically proliferates when market conditions include low inventories, low mortgage rates, and rising home prices. In hot market conditions, home sellers may receive enough buyer offers to outweigh the effects of the limited exposure of their homes on the open market.
Opponents of the practice argue that sellers may be disserved by pocket listings since MLS systems provide the widest possible market exposure and thus produce the highest possible selling prices. They also assert that pocket listings harm the effectiveness of the MLS cooperative brokerage system, skew MLS listings-based data that support accurate property valuations, and beg the question of whether agents may be utilizing narrowed marketing methods to collect the full available brokerage commission instead of soliciting purchase offers through cooperating brokers.
Proponents of the practice say that there are many reasons why sellers may not want to engage in the traditional practice of listing their properties on an MLS. For example, pocket listings are sometimes used to market high-end luxury homes whose owners have no interest in allowing showings to the general public and want the property marketed to those who have realistic means of purchasing it.
Other sellers may have privacy or security concerns about listing properties on widely broadcast MLSs or publishing interior photos of the property. Pocket listing proponents also argue that the MLS, which publishes the number of days a property has been on the market, can disadvantage owners who experience failed transactions due to complications that have nothing to do with the fair market price of the property.
Both supporters and critics generally agree that pocket listings are not illegal, per se. Real estate licensing laws, which vary among jurisdictions, may dictate the specific form of written listing agreement that must be used by licensees, the point at which it must be executed and/or require that certain brokerage relationships and other types of disclosures be included in the agreement. But the manner in which the property is to be marketed, and for what amount and form of brokerage commission, are matters that are generally left to be negotiated by the listing licensee and the seller.
A pocket listing policy subjects Aalto to accusations that they put their own interest in collecting a commission for both "sides" of a transaction ahead of the seller's interests in obtaining the highest possible sale price. Aalto keeps the entire Buyer’s Agent Commission when it acts as a dual agent, but sellers are able to determine what buy-side commission they offer (normally 2.5%). In effect, whenever a buyer is unrepresented, Aalto's total commission is likely 3.5% and not 1% as advertised. According to Aalto, "You are advised that a dual agency relationship may arise if an Aalto Advisor represents both you and a buyer of a property. If a dual agency relationship arises, the terms of such dual representation will be subject to a separate written agreement between you and your Aalto Advisor."
Other critics question whether sellers are being provided with disclosures that fully explain the potential disadvantages of narrowed marketing efforts. Regardless of those issues, it is fairly clear that real estate brokerage relationships, disclosures, advertising, conflicts of interest, and other licensing law strictures may raise serious issues with off-MLS practices.
Aalto further claims to operate a "marketplace" for homeowners. "Aalto's homeowner marketplace connects sellers to qualified buyers, saving you time, stress, and money." Aalto is not a marketplace, but a listing real estate agent with a website. Unlike MLS aggregators, Aalto does not display listings from other brokerages, and, therefore, lacks the networks effects required to deliver a full marketplace experience. Aalto is one of the millions of real estate agents in the United States.
Aalto's proposition is different from a typical listing agent by the mere fact that the listing addresses are hidden. "It is free to get started on Aalto" further makes for a very odd proposition, where it is free to get a listing started with any real estate broker.
"Prior to opening a home for showings through Aalto, sharing your property’s address through Aalto, or receiving the contact information of interested Buyers, a Seller must enter into a written agreement for real estate brokerage services between such Seller and Aalto," in another word, listing a home on Aalto is not free. Real estate brokers never work for free, and sellers' information will be shown only after they sign a listing agreement.
"Sellers start with Aalto earlier than traditional real estate, widening the time frame for homes to be on the market. That means more homes, sooner" is another odd proposition without any basis to substantiate the claim. Buyers browsing homes on Aalto have highly limited information about these properties, numbered at a fraction, of a fraction, of a fraction, of all homes available on the MLS.
"The Partner Agent Program is covered by the Partner Agent Terms of Service. Aalto is not responsible for the work performed or the services provided by any individual in connection with the Partner Agent Program." As a consumer, you will always overpay for broker commissions subject to hidden kickbacks and pay-to-play steering promoted in Aalto referral scheme to an unknown number of buyer agents. United States federal antitrust laws prohibit consumer allocation and blanket referral agreements between real estate companies. Homebuyers should avoid their information being "sold as a lead" between brokers in exchange for hidden commission kickbacks paid from the future home purchase administered by the Aalto Partner Agent Program.
We find no solid evidence that Aalto offers home sellers any advantages to sell homes for higher amounts, in fact, the opposite is much more likely. By withholding listings from the MLS, home sellers are likely missing out on the vast majority of tangible offers from the bulk of the home buyers and their respective buyer agents.
At the same time, some home sellers may decide for themselves that the off-MLS approach is worth the added risk and limited exposure for individual reasons. Aalto does save home sellers equity by offering a 1% listing rate against a 3% listing rate (this rate does not include 2.5% BAC typically offered at 2.5% to the buyer agent.)
Homebuyers should avoid Aalto Partner Agent Program due to hidden kickbacks and consumer allocation between licensed brokers. A homebuyer can easily negotiate a buyer refund on the open market with a licensed real estate broker in California - a fact that Aalto brokerage is silent on. Buyer refunds can save homebuyers tens of thousands in tax-free cash because the refund comes from the estimated 2.5% BAC proceeds received by the buyer agent.
Geodoma editorial staff remains overall neutral on the subject with a 3 out of 5-star rating for Aalto: we can neither recommend Aalto nor suggest that sellers refrain from using the brokerage to list their homes off-MLS.
As always, we encourage our users to post helpful and independent reviews about this business with any sentiment. With a controversial proposition such as Aalto, consumer feedback becomes incredibly valuable information to other consumers. Geodoma encourages users to post helpful, relevant, and reliable consumer reviews, but users are ultimately responsible for the quality of the content.
Where does Aalto operate?
Buying and Selling with HomeStory
WARNING: Unlawful Kickbacks, Broker-to-Broker Collusion, False Marketing, Wire Fraud, Price Fixing.
HomeStory) 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.
HomeStory is a price-fixing scheme that allocates home buyers to colluding Realtors through a "shell" real estate entity. When consumers submit information on the HomeStory website, this information is simply shared in exchange for an undisclosed fee with real estate agents in a process known as a pay-to-play steering and a "blind match." HomeStory Real Estate Services, Inc. "shell" entity colludes and price-fixes commissions with various Realtors affiliated with Keller Williams, Weichert, Christie's, RE/MAX, ERA, Compass, Coldwell Banker, Better Homes & Gardens, Berkshire Hathaway, eXp Realty, Exit, Fathom, Sotheby's, Century 21, HomeSmart, and others.
HomeStory Pricing
HomeStory fees come from hidden kickbacks, set at 25% to 40% of the gross commission received by a network of colluding Realtors.
Listing Services
- This Service Does Not Represent Sellers
Buyer's Agent Services
- This Service Does Not Represent Buyers
HomeStory Editor's Review:
HomeStory Real Estate Services, Inc. (dba HomeStory, HomeStory.com, HomeStoryRewards, HomeStoryRewards.com) is a licensed real estate entity in the State of Texas License No. 605602 operates as a "shell" broker to collect an undisclosed referral fee, set at 25% to 40% from the gross commissions paid by all colluding Realtors in the network. This fee is inevitably passed down to consumers in a form of inflated real estate commissions when selling a home.
More importantly, HomeStory is a licensed real estate entity that does not engage in actual real estate broker services. HomeStory systematically applies pay-to-play bias towards all Realtor matching results, meaning, only Realtors that have agreed to collude and pay a referral fee are matched with consumers.
Realtors only sign-up with HomeStory because the price of the referral fee can be easily incorporated into their client's agreement with excessive commissions.
HomeStory receives a low Editor's rating because this service is a biased hub-and-spoke broker-to-broker collusion scam, that falsely claims to provide an independent and unbiased service of matching consumers with agents.
HomeStory operates on a pay-to-play methodology to collect junk fees that needlessly make home buying and selling more expensive. In this scheme, consumers are no longer in the driver's seat, but instead, are traded as a commodity between brokers.
HomeStory plays junk fees down, claiming there are "no upfront costs" to Realtors and the service is "free" and "no obligation" to consumers, but it rigidly locks every participating Realtor into a kickback attached to the back-end of every agreement that restrains free trade. As a licensed real estate entity that doesn’t perform any real estate services or take any responsibility for the transaction, this scheme operates to unlawfully allocate consumers and bypass RESPA anti-kickback regulations through a "shell" entity.
Consumer brokering is an act of selling information of potential home buyers and home sellers (paid referrals) between real estate brokers, in exchange for a cut of a broker’s commission. Brokers on each side of the adopted scheme, cause direct damage to the real estate representation market with reverse competition, anticompetitive market allocation, price-fixing, lack of competition, limited choices to consumers, unnecessary high commissions, and improperly negotiated fees. A referring broker in this scheme does not compete with referred brokers, instead, HomeStory administers a series of agreements that restrain free trade, disguised as Realtor matching services.
12 C.F.R. § 1024.14(g)(1)(v) (Regulation X) and RESPA 12 U.S.C. § 2607(c)(3) narrowly allow payments pursuant to cooperative brokerage and referral arrangements between real estate agents and real estate brokers. This limited exemption on kickbacks only applies to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity. HomeStory does not act in a brokerage capacity, in fact, this entity willfully chooses to disengage from offering real estate representation services to consumers, as the core premise to create successful collusion through interstate wire communication to further the scheme. Wire fraud is financial fraud involving the use of any telecommunications or information technology.
Real estate transaction is a rare, high-value, and high-risk-aversion experience that is easily subjected to unlawful kickbacks, especially with the use of the Internet. Consumers are often subjected to high commissions and hidden referral fees without a full understanding that these fees increase their commissions and result in a lower quality of service. Whenever any double-dealing Realtor agrees to pay these massive kickbacks, he or she is unable to offer full and competitive representation services to anyone. HomeStory does not cater to honest Realtors, it only caters to Realtors willing to cheat their clients out of full services, and willing to share private information about their clients' transactions with the scheme.
HomeStory antitrust and consumer protection violations are not harmless. Realtors who attempt to compete for consumers on fair terms and competitive pricing are at a massive disadvantage in this environment. As a result of broker-to-broker collusion, consumers end up getting steered toward a limited pool of agents and overpay for commissions. Consumers’ private transaction information is always shared with a referring broker that requires it to be disclosed to calculate the referral fees to be paid at the close of each transaction.
Consumers, of course, pay for this abuse with higher costs of commissions that, eventually, make it directly into their new mortgages and cause significant losses of net equity from a home sale.
HomeStory utilizes several high-profile financial institutions and lending channels to promote price-fixing and fraud to consumers across state borders, such as HSBC Bank USA, JPMorgan Chase Bank NA, Lakeview Loan Servicing, LLC, The Money Source Inc., Alliant Credit Union, Home Point Financial, etc.
| HOME VALUE | REWARD |
| $0 - $99K | $350 |
| $100K - $149K | $650 |
| $150K - $249K | $900 |
| $250K - $349K | $1,000 |
| $350K - $449K | $1,250 |
| $450K - $499K | $1,750 |
| $500K - $549K | $2,000 |
| $550K - $599K | $2,300 |
| $600K - $699K | $2,400 |
| $700K - $799K | $2,750 |
| $800K - $899K | $3,100 |
| $900K - $999K | $3,500 |
| $1.0M - $1.099M | $4,000 |
| $1.1M - $1.199M | $4,350 |
| $1.2M - $1.299M | $4,750 |
| $1.3M - $1.399M | $5,500 |
| $1.4M - $1.499M | $6,000 |
| $1.5M+ | $6,500 |
Obviously, these are plain price fixed amounts imposed by HomeStory on random brokerages. All of this is done to profit from the largest number of transactions, without actually performing the service of a real estate broker. The scheme is disguised as if consumers are saving money, but in reality, consumers lose money in hidden kickbacks.
For example, on a home purchase of $1 million, Home Story price-fixes the rebate for ALL "partner agents" at $4,000. What the scheme fails to mention is that the kickback HomeStory secretly takes (assuming a 30% kickback) from that same transaction is $9,000 - more than double the amount the consumer receives. On the open market, consumers can easily receive a buyer rebate valued at $15,000 or more, instead of a price-fixed $4,000 amount. This $9,000 loss is, obviously, the price difference between wire fraud, false advertising, collusion, price-fixing, as opposed to open competition. Moreover, honest agents able to offer even better terms to consumers on the open market are bypassed by this scheme entirely. Price fixing does not only harm consumers, but it harms all honest participants outside of the scheme, as well as the open nature of the real estate market itself.
HomeStory shell broker does not connect consumers with anyone outside the network, in fact, they specifically steer consumers into the network in exchange for massive kickbacks pre-negotiated in advance.
There are numerous reasons why consumers are wise to avoid the HomeStory scheme, but probably the most important reason is that the lack of transparency and honesty is contagious. HomeStory scheme attracts ONLY double-dealing Realtors who are willing to break a host of federal antitrust laws, and unwilling to compete for consumers with transparency. An unethical Realtor will always find a way to turn the most important transaction into a self-dealing proposition - to collect a bigger commission check faster without any regard for what is truly a good deal for their clients.
Why Does HomeStory Engage in Price-Fixing?
HomeStory engages in price-fixing because it needs a "dangling carrot in front of consumers" to "reasonably" justify the kickbacks it takes from the Realtors who patriciate in the scheme. This dynamic is better known as a hub-and-spoke conspiracy. In a hub-and-spoke type conspiracy, all listing rates are set at the same amount for all Realtors, where none of the "partner agents" compete with one another on pricing at all. HomeStory scheme produces absolutely no tangible service as a licensed broker to anyone and instead delivers inflated prices and lower quality of service. The scheme originates as a conspiracy to restrain trade and to funnel consumers toward the scheme and away from the open market. There are hundreds of thousands of highly competitive Realtors who offer great savings and great service, and they refuse to pay kickbacks or to comply with the price fixed rates set by HomeStory.
The illicit 25% kickback is the reason why HomeStory setsHSBC HomeStory listing commission rates for Realtors outside their firm. ALL consumers and ALL legitimate Realtors are scammed by HomeStory, even if the experience and savings may seem "good enough" because price-fixing is a faulty shortcut to genuine open competition between Realtors. By law, all Realtors must compete for consumers and set prices individually. Open competition is at the core of our free and independent society everywhere in America.
The Realtor commissions in the United States have long suffered from the "standard" 6% myth and the false notion that "buyer agents work for free." However, these myths cannot be resolved with price-fixing of commissions to some other level, in exchange for kickbacks. ALL Realtors who participate in the HomeStory scheme are engaged in price-fixing. The Sherman Act imposes criminal penalties of up to $100 million for a corporation and $1 million for an individual, along with up to 10 years in prison for each count. Persons found guilty of wire fraud under federal law face fines up to $250,000 for individuals and up to $500,000 for organizations, subject to imprisonment of not more than 20 years. There are additional penalties of 30 years imprisonment and a million-dollar fine if the wire fraud involves a financial institution. These penalties are per count, which means that each electronic communication can be considered as a separate count. No legitimate Realtor will ever willingly allow themselves to be exposed to such massive liability.
The best, highly-experienced, well-educated, law-abiding, honest, and ethical Realtors will never participate in price-fixing because it is a felony that carries massive penalties. The best Realtors can recognize price-fixing as wrong because they respect the true value of honest negotiations.
The prices set by HomeStory are not for the services that they offer, but for services offered by their direct competitors – other brokers. When HomeStory refuses to compete with these brokers and instead organizes "partner agents" into a network, it breaks an entire host of basic principles that guide our open and fair markets. Moreover, HomeStory extends this conspiracy all across the United States, making the scheme highly damaging due to the scaled use of the Internet to transmit collusion. The Internet, like any other scaled information medium, can be used to transmit open competition just as easily as pay-to-play fraud and collusion.
HomeStory wire fraud scheme is particularly alarming because it is scaled across state borders by financial institutions such as HSBC Bank USA, JPMorgan Chase Bank NA, Lakeview Loan Servicing, LLC, The Money Source Inc., Alliant Credit Union, Home Point Financial, etc. in an open violation of RESPA and Sherman Antitrust Act by means of wire communications interstate channels such as the following:
HSBC HomeStory wire fraud channel
Fidelity HomeStory wire fraud channel
Chase Homestory wire fraud channel
The short answer is: HomeStory's intent to fix prices is directly tied into the kickbacks it receives from the "partner agents." This dynamic is a product of the restraint of genuine competition. The "standard commissions" problem in the residential real estate sector can only be fixed legally by encouraging Realtors to set and advertise competitive prices to consumers at scale without paying any kickbacks.