For now, the Purplebricks saga is over. Once the darling of the AIM market and a brand feared by the mainstream estate agency sector, the great disruptor has all but evaporated from its former £1bn self.

From game changer to just a handful of change as competitor Strike has picked the thing up, £30m liabilities and all, for a quid.

My thoughts on the prospects for ‘PurpleStrike’ are that smashing together Betamax and Blockbuster is unlikely to yield a great outcome. Strike sells homes for nought and Purplebricks can’t make ends meet even with fees that are just shy of the average for most of the country.

Despite the fact that Purplebricks has been ‘saved’ let’s be honest about how this all looks. Strike has consumed £75m of Charles Dunstone’s children’s inheritance so far and PurpleBricks makes losses in the twenties of millions of pounds each year with huge liabilities and with potentially expensive litigation still hanging over its head.

Sam Mitchell, day to day boss of the newly Frankensteined monster, has doubled down and pledged publicly to continue to commoditise estate agency and to sell its services on the cheap. He and Dunstone talk of becoming the ‘Amazon of estate agents’ by which perhaps they mean a descent into a depleting, dark forest full of snakes and bugs that’s easy to get lost in? But I think they probably mean instead that they think the British public will one day, finally embrace selling their homes in the same way that they order pen refills and John Grisham novels.

The problem with that belief is that ‘cheap online estate agency’ is now twenty years old and has had over £250m thrown at it to prove the concept – and the only thing that’s been wholeheartedly established is that 95% of sellers still want to pay a traditional estate agency fee. Of course, I know this to my own cost.

‘Insanity is doing the same thing over and over again and expecting different results’ said Einstein. But Charles and Sam are seemingly not very acquainted with Albert’s missives.

Apart from proving the resilience of a somewhat tired but basically effective traditional estate agency model, Purplebricks and its peers have succeeded in advancing one big change in our industry though – self-employment.

Before Michael and Kenny Bruce introduced self-employed LPEs in 2014 there were almost no such estate agents in Britain. At their peak, PB got to around 650 LPEs and then the other onliners added their’s too resulting in a milestone of around 1000 agents working for themselves.

Famously, the then CEO Vic Darvey later ran scared of HMRC and converted everyone to employed status and arguably this was the thing that broke their model given the increase in costs and liabilities that I speculated at the time were going to cost PB £6m or so per year.

But, the advent of online agents being self-employed got us all used to the concept. Note that in the US all real estate agents are considered ‘statutory non employees’ and therefore self-employed contractors. It’s just standard there.

I’m a big fan of the self-employed estate agency business model here (despite my dissatisfaction with the Keller Williams UK experience but that’s another story) because good agents that can generate their own business and want to work hard can be their own boss and earn more, much more, than working for someone else. eXp, Nested, The Agency, Agent & Homes are all getting traction.

From the wreckage of the busted online agency experiment is born a sector that undoubtedly works. Creative destruction laid bare.

The self-employed approach is better for the agent themselves (most, not all) and, I argue, for the customer too in that higher paid, more engaged people are bound to be better at the service they deliver. Consequently these better agents will end up being able to charge higher fees because they’re better and this culminates in whatever the opposite is of a race to the bottom.

So, we should really be saying ‘thank you Purplebricks’, shouldn’t we?

Russell Quirk is co-founder of ProperPR, the public relations agency specialising in the property industry. He is also a regular commentator on property and politics for national media and hosts a TalkTV show 

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