Purplebricks has launched in London, ahead of a possible float in the second half of this year.
Chief executive Michael Bruce told the London Evening Standard that the firm is seeing growth of 25% a month, although firms such as LSL, Countrywide and Foxtons have all reported slides in sales.
He said: “I don’t think it’s just the election. We’re seeing growth, as a new brand offering something very, very different for a lot less money.”
The paper reports Purplebricks as charging a flat fee of £665 plus VAT – the firm does not display its prices inclusive of VAT – saying it claims this saves Londoners at least £6,000 compared with traditional estate agents.
The paper quotes Bruce: “It’s the greatest cost saving for people in and around the capital than anywhere else in the UK.”
On the Purplebricks website, it says that in certain London areas it charges £965 plus VAT “due to increased costs”. We entered a W1A postcode and found the higher cost applies there.
Bruce told the Standard: “It’s key to us to get positioned in London and get well known.
“If we can do that the way we think we can do it, in the second half of the year things like an IPO are a distinct option for us.
“If the market’s right and the Government’s right, I definitely wouldn’t rule it out.”
At the weekend, Purplebricks had 1,956 sales properties listed in total.
Comments (16)
The problem that I see happening is that if/when online agency does “take off” then it will become very price sensitive leading to an average fee of around £100. Emoov, PB ,Easy, plus 1000s of others will be sucked into an online price war(probably headed by Rightmove, who already take personal private listings). That, in my opinion, is why most want to sell the “idea” of the business on the stock market before the competition for online instructions really hots up.
“8.I cannot see how they can pay back all their funding to be profitable”….is that why they only ever go on about stock market flotation?
Also, “provocative”…..phone outs……any tips/lines you want to share with us?
Obviously all such calls are handled by ‘Cheree’, wilko.
I’d say “Yes” to her smoky, sultry voice… ;o)
Even if they sold every house they had on their books today, it wouldn’t even cover the cost of their television campaigns – let alone all the other expenses the business has to pay for.
This site is a massive money pit and clearly the plan is to list as many properties as possible, float it and then sell it off to a load of unsuspecting investors who have been sold on the “online agent is the future” hype leaving them with an absolute trash can.
Make OnTheMarket stronger and squeeze out the flyboys
OTM is the wrong tech – its just a RM2 – go back before RM even and your find better solutions that today’s agents on the whole are not doing. there is a better way. Its not being a 4th-5th-6th place RM2 though
Yeah… but they have Waldorf & Stadtler doing their adverts…
…isn’t it?
I think that seeing “growth” is a very different proposition when that growth applies to listings not sales.
They still need to generate over 2300 listings a month to even give them the turnover of a 15-20 office outfit.
Don’t forget that agencies with a high number of boards often aren’t the best at achieving the best for the vendor!
‘agency negotiation limited’
Apart from posting the freaking obvious to an audience predominantly made up of ESTATE AGENTS – any actual point you are making in relation to the story would be what, exactly?
‘agency negotiation limited’ – are you The Artist Formerly Known As “Happy Chappy”?
He saw himself as some kind of fee-saving magician as well…
http://www.agencynegotiation.com/
Yeah… I know.
Charges £250 on the basis that the ‘saving’ made on Estsate Agent Fees is THE SAME or greater.
Oh – and that ‘saving’ is based upon THE INITIAL VALUATION – and NOT the price the property is sold for.
Oh – and look at this one: ” The vendor acknowledges that the service provided and the fee paid shall not be dependent upon the sale of the vendors property.”
Canny work if you can get it, innit?
But in Kent they have a number up that show SOLD stc – indicating willing buyers/willing sellers. Traditional agents need to up their game. Obviously it helps PB having £millions behind them from fund raising.
So their game plan is to up fees.
Investors who have put in £millions must be wanting more for their return. All said they are gaining a lot of boards up.
Without RM or Z they’d be dead in the water. Many might say that the UK portal model is more hindrance to traditional agents now than good.
PLUS VAT!
Don’t they understand UK Law…?