Vendors should weigh up all their options before instructing Purplebricks as they run the risk of losing their money if the property fails to sell, warns the HomeOwners Alliance (HOA).
The HOA points to Purplebricks’ upfront fees; extras packages costing £899 or £1,499, which can prove expensive if a deal falls through.
“You need to do the maths and think about the implication of paying upfront,” said Angela Kerr, director of the HOA.
“A high street estate agent’s fee is payable on completion. So no sale, no fee,” she added.
Kerr accepts that moving home is “ridiculously expensive”, and it is therefore no surprise that people are looking to pay less.
But Kerr questions whether sellers should rely on valuations given by online agents such as Purplebricks.
She told the Mail online: “Our advice to homesellers is not to rely on any online estate agent for an accurate valuation.
“Online estate agents may not have the local knowledge and may rely on online data. So we always advise getting a few local high street estate agents to value your home, alongside valuations you receive from any online agents.
“Your high street agent is likely to know your local housing market better than anyone else so will be well-equipped to give you a realistic valuation.
“Invite at least three agents round to value the property and discuss marketing. If they’re a good salesperson, they may even convince you to use them. But don’t forget to negotiate the fee.”
Sam Mitchell, chief executive of Purplebricks, has defended his firm’s fee structure.
He said: “We think estate agent commission – the percentage of sale price of a home – is a poor way of paying for estate agency services.
“It implies that work by an estate agent differs according to the price of your home, which simply isn’t true.
“The work required to value, list, market and negotiate a home remains similar each time.
“With Purplebricks’ pricing model, customers pay far less than commission via a high street agent on average, and know exactly what they’re paying for.”
Moving home is not “ridiculously expensive” if one considers all the work going on that vendors don’t see. It’s very good value if the job is done well.
Even more ridiculous is the assumption that “the work remains similar each time.”
How would an agency that is positioned at the lowest end of the market know anything about the work required to market homes in the premium sector?
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Reactive selling- relying on portal enquiries for viewings and sales cannot produce the competitive tension of proactive selling where a skilled agent will have 2 or 3 potential purchasers competing for a home.
Reactive selling achieves about 5% less for the vendor (Gavin Brazg at the Advisory did some research a few years back to confirm this)
I’m not sure where the £899 or £1499 comes from the adverts say the (portal listing) service is free, it makes no odds saving £3550 to miss out 5% on the transaction average price achieved (£360,000) costs vendors who fall for the marketing claims an average £18,000
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I need to be quite careful about how I word this…
As a surveyor, I formerly value properties on a very regular basis.
I can only agree with the “below full value” appearance of properties sold by online only agencies.
Saving a couple of grand on fees looks like a good idea, but losing ten or twenty thousand on an achieved sale price often seems to be the trade-off.
No sale, no fee with a proper, locally based high street agent charging a sensible commission rate for a job well done, gets the best result as far as I can tell.
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It is not just over valuing as this is done by many high street agents as well. As Robert May suggests, placing a property for sale on-line and waiting for an enquiry is a no-skilled job that any Tom, Dick or Harry can do.
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Seemingly not; the 1 * reviews suggest that quite a lot of clients are disappointed with the passive listing service they receive . Seems Tom, Dick and Harry aren’t managing to plonk property on the portals
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