Orchard is relatively young, having launched in 2017 under the name Perch before rebranding as Orchard in 2020. Operating in 10 markets throughout six states, this power buyer offers attractive incentives that differentiate it from other iBuyers. While many iBuyers focus on home sellers, Orchard is one of a few that also guides clients through the buying process.
What is Orchard?
Orchard is a real estate company that offers several key services to its customers. It aims to address a notorious sore spot for homeowners looking to move: the high-wire act of buying and selling a house at the same time.
Orchard’s clients can list their home on the market and receive a guaranteed backup offer from the company through the List with Orchard service, or they could buy a new house before selling the old one with Move First. This program “unlocks” most of a homeowner’s equity upfront, allowing them to make an offer without contingencies.
The company can provide a more traditional selling experience at a discount through Buy & List and can even turn clients into cash buyers with Offer Boost, making bids more competitive.
Orchard is currently doing business in 10 real estate markets:
Maryland: Montgomery County.
North Carolina: Charlotte, Raleigh-Durham.
Texas: Austin, Dallas-Fort Worth, Houston, San Antonio.
Virginia: Northern Virginia.
Despite operating in limited markets, the company says it has worked with clients to buy and sell over $1 billion in homes.
What kinds of homes does Orchard buy?
Orchard has specific property requirements for sellers. It must be a single-family home built after 1920, and it can’t be currently listed on the market. The home’s value also has to be greater than a minimum that varies by location, with the lowest minimum being $100,000 in Atlanta and the highest minimum being $300,000 in Montgomery County and Northern Virginia.
How does Orchard work?
Orchard offers three distinct services for clients, each serving sellers with different needs and goals. Move First is for customers buying and selling with Orchard, List with Orchard is for sellers who are moving outside of Orchard’s markets, and Buy & List offers a more traditional experience at a discount rate for in-market buyers and sellers.
1. Get an initial home estimate
After you fill out Orchard’s online form, you’ll receive an initial estimate for the value of your home. Then, you can schedule a 30-minute virtual assessment to share more details about your home. This is how Orchard determines the amount of “instant equity” it will offer you — the amount of money you’ll receive to put toward your new home purchase before your old home sells.
Your instant equity can be up to 90% of the valuation of your home, and it enables you to move quickly with an offer on a new home without a home sale contingency. Orchard backs this offer by buying your old home a few days before you close on the new one.
2. Orchard recommends upgrades to facilitate your home sale
Suggested upgrades may include things like floor repairs, painting, minor roofing services, etc. Orchard can connect you with a partner vendor to complete any repairs or renovations that you choose through a service it calls Concierge. Orchard manages these projects, and the vendor’s costs are subtracted from the additional sale proceeds.
3. Shop for your new home
You’ll work with one of Orchard’s full-time agents, called a Home Advisor, to shop for a new home in one of Orchard’s markets and make an offer before the company finds a buyer for your current home.
If you don’t find a home that fits your needs through Orchard, or if you change your mind about your next move, you can end the agreement and still list your home through the company if you’d like.
Qualified Move First customers also have the option of using Orchard’s Offer Boost program, where the company will make a cash offer on the home of your choice on your behalf. You can move in right after closing, but you’ll have to pay rent to the company until your old home sells. According to Orchard, this fee is negotiated with the company at typically $30 to $50 per day and gets deducted from your home sale proceeds.
4. Orchard sells your home and shares the additional proceeds
Orchard has a 120-day listing period to sell your home. If it doesn’t sell it within this window, Orchard will buy your home outright for a predetermined price. Whether it sells to a buyer or purchases the home itself, you’ll receive the additional proceeds beyond the instant equity amount minus a fee equal to 6% of the home’s sale price and the cost of any repairs and rent. Once an offer on your home is accepted, you’ll enter the closing process, which takes an average of 30 to 45 days and costs about 1% of the home’s sale price.
List with Orchard
1. Get an initial home estimate
After you fill out Orchard’s online form, you’ll receive an initial estimate for the value of your home and schedule a consultation with your designated Home Advisor to complete a virtual home assessment. This will inform the recommended listing price, as well as the backup cash offer the company provides if the home doesn’t sell within the 120-day listing period.
2. Make upgrades to the home, if you like
Orchard’s team will recommend upgrades to your home to help it appeal to potential buyers. If you’d like to make those changes, Orchard can manage those projects through its Concierge service.
3. List and sell your home, or pull out
Orchard will prepare your home, market it and make a guaranteed offer if you need to sell quickly, or if your home doesn’t sell within 120 days. You’ll pay 6% of the home’s final sale price in fees, plus an additional 1% “convenience fee” if you decide to sell directly to Orchard before the end of the listing period. If you elect to use the Concierge service, those costs will also be deducted from your sales proceeds.
You don’t have to sell to Orchard if you reach the end of the listing period without a buyer, and you can choose to take down your listing without incurring a cost. You also have control over the price during the listing period if you decide that you want to change it.
4. Close on the home sale
Once you accept an offer, you’ll close on the home. You’ll coordinate with the closing officer from the title company, and the process typically takes 30 to 45 days.
Buy & List
1. Decide where you’d like to start
Unlike Move First, Orchard’s other service for clients moving in-market, Buy & List allows you to choose whether you’d rather focus first on buying a new home or selling your current one. Whatever you decide, you’ll fill out the online form to get your valuation and move forward with a virtual home assessment.
2. If you’re ready to buy
If you’re ready to buy, you’ll work with your Home Advisor to tour homes, make a selection and make an offer. Your Home Advisor can also guide you through getting preapproved for a loan and choosing a lender.
3. If you’re ready to sell
If you’re ready to sell, you’ll work with your Home Advisor to prep your home, list it and ultimately sell it. Your Home Advisor will make recommendations for upgrades, and they’ll suggest a listing price based on the details of your home and comparable recent sales data.
The main benefit of this program is that you’ll pay a fee equal to 4% of the home’s selling price, compared with the 5% to 6% you’d pay in a standard real estate agent commission.
If you’re buying through Orchard, you’ll have the option of either using your own preferred lender or comparing lender rates through Orchard Home Loans to finance your purchase. In any case, you should get preapproved for a mortgage before you start shopping.
Orchard’s selling services
Across all of its programs, Orchard takes on the responsibilities of listing and marketing your home. These services include:
Recommendations for repairs and upgrades, and project management through the Concierge service if you choose to use it.
The exact cost of working with Orchard will depend on which program you choose to sell your home.
You pay a fee equal to 6% of your home’s sale price, similar to the 5% to 6% average commission that you would pay a traditional agent.
Orchard purchases a home in cash on your behalf, and you pay rent until your old home sells. While rent costs vary, the company reports that they average $30 to $50 per day. You also pay a fee equal to 6% of your home’s sale price.
You pay a fee equal to 6% of the home’s sale price, plus a 1% convenience fee if you choose to sell your home directly to Orchard instead of waiting out the 120-day listing period.
You pay a fee equal to 4% of your home’s sale price.
Orchard’s Concierge service
While there are no direct fees for using this service as an add-on to Move First, List with Orchard, or Buy & List, the costs of any work completed as a result of Orchard’s recommendations will be subtracted from the proceeds of the home sale.
How to get started with Orchard
If you decide to explore working with Orchard, you can fill out an online form with details about your home. You’ll receive an initial estimate, and you’ll be contacted by a Home Advisor to set up a more comprehensive assessment.
You don’t sign on with Orchard until after you’ve reviewed and agreed to its valuation of your home. Even after signing on, you can cancel the agreement before your home’s sale.