Purplebricks made over £18m in fees last year on “thousands” of homes that did not sell, it is being claimed this morning.
The Telegraph says that it banked the money “as the housing market froze on political uncertainty”.
The story says that Purplebricks “withdrew 21,380 listings” last year, citing housing market data firm TwentyCi as its source.
The story quotes a Purplebricks spokesperson who said that its customers understood the fixed-fee pricing model. The spokesperson said: “We are very confident that our customers understand our upfront fee model and know it gives them a much higher chance of selling, for a much lower cost.”
The Telegraph says that Purplebricks estimates it saved customers more than £150m in commission in the first half of last year.
Meanwhile Purplebricks’s Facebook page was down all over the weekend and remains down this morning.
The agent’s Twitter account acknowledged the problem and said it was working with Facebook to resolve it.
A spokesperson told EYE that it appeared to be a technical issue at Facebook’s end, but expected it to be resolved shortly.
The page went down after an advert which drew a number of comments. By this morning, Purplebricks’ Facebook page was still unavailable.
Comments (31)
I supplied the story to the telegraph who decided to run it without mentioning the person who sourced the story – me Andrew Stanton naughty – maybe journalists should have better manners. It is a fact that Purplebricks listed over 60,000 properties in the UK last year and they withdrew 21,380. At a base fee of £999 that is £21.35M and at higher fee of £1399 that is 21,380 x 1399 = £29.91M so probably true figure somewhere in between. You need to add in the Australia and USA withdrawals as well, both arms closing in 2019 so I feel some thousands of vendors in those countries paid upfront and lost it all. So maybe the true amount of capital ‘banked’ and kept by this purple Behemoth is £30M. Now this is only one year, add the previous years and you are getting to a very big figure, for not selling a single property, great work if the public will swallow it. Also if you list 60,0000 and lose 20,000 in same year how can you exchange on 81% as Purplebricks insists that it does, each year? Then again mathematics not my strong point I am only an analyst.
Andrew
Don’t forget to add in something for the ‘accompanied viewings’ package – which probably a quarter or more pay for – and some get nothing in return; buying yourself out of an expensive solicitors package when you select to pay later for not selling; “Premium Listings” packages…
…the list goes on – and it’s bound to stick several £millions onto the total paid for failure.
For all the analysis and city shenanigans they’re just not any good, that’s the be all and end all of it, proptech shmoteck, this is a people business nothing to do with property other than understanding the rules, on the phone today for an hour trying to help an 85yr old ex client work out what’s going on with her gas account, won’t get paid a bean other than she and her extended family simply won’t use anybody else, ever.
Well said. Very well said.
88.7p if you’re currently interested in buying one share.
Lol, they’re blaming the Corona Virus… Yes, the Corona Virus is hitting the global sharemarket, but PB are now Terminal. This is what happens when puppetmasters depart and the muppets are left behind.
85.00p now
Maybe the truth is finally starting to come out!
BSOS23PC
PurpleBOOM …..PurpleBUST!
“We are very confident that our customers understand our upfront fee model and know it gives them a much higher chance of selling…”
Why does the payment of an upfront fee give anyone a better chance of selling something compared to a success based fee model?
Any PB supporters on here able to explain that one?
Anyone who wishes to challenge PB over their various claims, please feel free to use (at your own risk), my formal complaint https://wordpress.com/post/targetswillfallwhenhit.wordpress.com/1377
“Formal complaint made to regulatory authorities in February 2018”
And so it rolls on… and on….
…part of me is angry at the damage PB has done to the industry but part of me is beyond belief at how the public continues to support this kind of failure…. can’t really blame a fox for eating the chickens if they wander into his den by their own free will….
Where are the ambulance chasers when you need them?
Having been asked to leave the business for no apparent reason last year, I was rather bemused to receive some phone calls from PB on Friday. The poor call centre staff were looking for some help with irate customers but couldn’t get hold of any relevant current staff. Darcey, Davies and Warren. Take a bow.
This is why no one with a local presence would copy this model.
Staff would get to much abuse. Ok if you can hide in a big hq but not if the irate customer can walk in and punch you.
Surely this is a breach of GDPR in some way?
Why do you think Stephen Parker has just left?
GDPR & AML regulations just don’t exist at PB.
He wanted out before ending up in prison!
As sponsors of Team GB, I wonder whether they will insist athletes still get medals even if they don’t win.
Doomed
It’ll be back without the comments section, I would imagine.
Pitiful business. Those 21,000 people who paid for absolutely nothing are going to haunt the business.
The end is nigh
If I lose a bet on horse race I don’t ‘haunt’ the bookie this is no different. Vendors chose to gamble with the sale of their homes by paying PB and got what they deserved.
“If I lose a bet on horse race I don’t ‘haunt’ the bookie this is no different. Vendors chose to gamble with the sale of their homes by paying PB and got what they deserved.”
No, ARC – they didn’t. Your analogy is waaaay off point.
When you have a flutter on the nags you are given the odds of winning before you place your bet. You then gamble on your chosen nag beating those odds in order to make a return on your stake.
On the reverse side of that, Bricks’ website states
“Sell with Purplebricks for a fair fixed fee”
The operative word here is SELL. It doesn’t say “Have a punt with Purplebricks…”; nowhere do I see “Toss a coin with your money…” – it states a result.
And a POSITIVE result at that. One which for many simply doesn’t happen – and they pay exactly the same money for that failure as those that actually sell…
…which is what they signed up for.
“Sell with Purplebricks for a fair fixed fee”
Exactly, why ASA and NTSELAT aren’t all over this like a rash is beyond belief.
Hopefully, the claims management “ambulance chasers” get there first. 🙂
If a vendor before parting with their money fails to ask ‘well what happens if I don’t sell it?’ then they deserve to lose their money and those that do ask get told ‘well you’ve lost your money’ and take the gamble anyway know they are taking a chance and feel the possible ‘saving’ is worth that risk and some win and some lose.
“If a vendor before parting with their money fails to ask ‘well what happens if I don’t sell it?’ then they deserve to lose their money…”
That kind of “one born every minute” attitude has no place in our industry.
I agree but sometimes they don’t seek out or listen to the advice of experts such as yourself and decide to go alone and then I’m afraid they do reap what they sow.
But their PB “expert” is duty bound to make it very clear what they are signing up to.
Just as the industry “regulators” are there as a backstop to ensure that the public are protected from any “bad apples.”
Classic spin doctoring – it went down because Friday was D-day and 100s of fired LPEs and quite a few customers posted their views on PBs page.
It was very entertaining, the complaints department couldn’t respond with their typical cut and paste responses quick enough.
Hilarious and sad, at the same time.
Why have they been firing LPE’s?
The recent shuffle of the deckchairs was just TO’s wasn’t it?
No, they got rid of the regional director role so sacked a lot of self employed territory owners to redeploy the ex employed regional directors.
They have been slowly bullying off the oldest of the territory owners, hoping they would leave before having to pay them off, despite how well they were performing because it was coming up to renewal of the 5 year contracts and upcoming new IR35 requirements.
I think that is it in a nutshell.
Facebook did nothing, PB took it down because of all the backlash they’ve been getting from upset employees and disgruntled customers.
Vic opened a can of worms and the CFO’s recent interview insulted everyone.
Good luck putting this fire out boys, you’re going to have to do the impossible to save this leaky purple ship now…