Housesimple is confident of hitting profitability early next year and hopes to cover the whole of the UK within 18 months, its chief executive Sam Mitchell has revealed.
Mitchell, who scrapped all fees for the vendors using the online agent earlier this year, said the indicators from its initial rollout of the service in Yorkshire and other parts of northern England suggest it is destined for profit.
Speaking to EYE, Mitchell said: “We would like to cover most of the UK in the next 18 months.
“We need to make sure we get the strategy right first.”
Rightmove figures show Housesimple currently has 2,315 listings, of which 969 are either under offer or sold subject to contract.
Mitchell revealed he has been told by Rightmove that it has the equivalent of 91 branches of stock.
He said Housesimple would make money from its mortgage broking, conveyancing and home moving services but said it wasn’t obligatory for vendors to use them.
Mitchell said the agent was also hopeful buyers using other agents would use its financial and moving services.
He said only 3-4% of its seller and buyer base would need to interact with its financial services to “make it stack up”.
He said Housesimple has already overtaken Purplebricks for market share in Yorkshire just 12 weeks after launching the free service.
Mitchell declined to reveal the agent’s conversion ratio and use of its financial services but said it was “broadly in line with what we want”.
He said the next rollout would be in “densely populated, lookalike towns” to where it currently operates in Leeds, Manchester and Liverpool.
Mitchell said he was unconcerned about rivals such as Yopa raising more funds.
He admitted Housesimple may need more money from its backers Toscafund and Carphone Warehouse founder Charles Dunstone to expand but said it was important to have the right strategy rather than a “money first approach”.
Mitchell said: “Our backers are supportive and we have a running dialogue.
“If you take a money first approach then you have to outspend Purplebricks.
“The important thing is to differentiate. I would be more worried if others were changing their strategy.”