The new owner of Purplebricks has today announced a major fee cut in a bid to recapture the glory days for the firm.
At one stage, Purplebricks was the poster child for estate agency disruption, driving rapid expansion across the country and impressive growth figures. But the company posted spectacular losses in recent years, forcing the business to be sold to Strike for just £1 last week.
Low fee estate agencies, particularly Purplebricks, have come under fire in the past, not just because they are generally a lot cheaper than high-street estate agencies, but also because, according to some, the downward push on fees has worsened standards across the industry.
However, that has not deterred the new owner of Purplebricks re-starting the ‘disruption’ that first made it a household name, with a new nationwide fee structure.
The new pricing will apply across the entire country and removes the premium for properties in London; Purplebricks fees have hit a record low in the capital.
From today the nationwide fee will be slashed to £999. This represents a reduction of 26% on its previous pricing for properties outside of London and a reduction of 67% for properties within London and the South East.
For the pro-pack, which includes accompanied viewings, the nationwide price will be £1,699. Both packages include professional photography and floor plans, as well as a Local Property Partner, backed up by a central property support team to see all customers through the whole property purchasing journey through to sale completion.
Based on the average UK house price of £260,736 in May 2023 according to the Nationwide House Price Index and a traditional estate agents commission of 1.5%, consumers would save £2,912 using Purplebricks, or £2,212 for those choosing the pro-pack, with the value proposition is even greater with London properties, according to new CEO of Purplebricks, Sam Mitchell.
He said: “We are back in the game with a new value offering, returning to our roots as a major disrupting force in the industry. With the support of our new owners, we are going on the offensive again with the launch of the first element in our new strategy to recapture market share, and provide consumers with a much needed value offering in these difficult economic times.”
Purplebricks’ ‘failed’ model blamed for lower estate agency standards
The last refuge of agencies that can’t inspire – drop the fee.
Default dead strategy. I give it a year.
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£1000 is alot for what they do. Why is govt or our trade bodies not kicking up more about this?
Killing an industry is not good for the economy .
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If they actually worked for it, then sure. But once you’ve paid… what’s their incentive to actually SELL your property?
You’re paying to instruct them, not for them to actually sell anything.
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It is called competition the govt cannot get involved
Should they close Greggs the bakers because they are rubbish
Or Persimmon because there houses are cheaper than others
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If Greg’s sold a slice that turned into #hit after you bought it, the govt would stop it.
Govt too stupid to understand damage being done.
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If I am selling my home, which is probably the biggest asset I will ever own, I would never use an agency whose biggest claim is to have its roots in being a major disrupting force in the sector. I want an agent whose roots are in successfully selling property.
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Right so, I’ve bought this business that failed for £1 right. What I’m gonna do is exactly the same as it did before but not put as much money into advertising right. But this time I’m gonna make it succeed. If I do EXACTLY the same it’s gonna be brilliant right?!
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The definition of insanity is doing the same thing over and over again and expecting different results!
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Remember when Elon Musk bought Twitter, proclaimed himself saviour of the world, and set about running it into the ground…?
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Anyone who bothers with twatter is by definition a ….
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FGS
Just call this PB eye
It is all people seem to want to comment on
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The irony here that you’re complaining about people commenting on a Purplebricks article, by commenting on a Purplebricks article.
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How original
What I do NOT do is slag off my competition who build cheaper lower spec house than I do
I understand that there is competition in the market
Our sales staff point out the differences between our houses and those of the competition and why we are better
They can sell
Suggest you try to do the same
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I am actually a builder/developer myself Jan and have never once commented on substandard building. However if people want my honest opinion I’ll give them it.
You’re not the only developer on here Jan, and we aren’t all as narcissistic as you.
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The interesting thing is Jan, that 25% of the comments on this article belong to you (prior to my comment).
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So the fight back is to reduce fees yer that will work, so agents just need to leave Rightmove, reduce their fees by the savings they will make and sit back and watch Rightmove change to direct sales that will kill PB and Strike completely.
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Yes I cannot understand why agents do not all just pull out of RM and make them be sensible
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Cheap is rarely good… Quality is never cheap.
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I haven’t stopped laughing, you are going to cut and restrict your income for a failing business that is making massive losses, not paying any dividend for its investors (ever) which you need to survive at snail pace, when you are already charging higher fee’s. Total nonsense. If this could be achieved it would already have been tried. Oh, yes they did and had to put the fees up and still failing.
This puts the livelihood of its employees at serious risk and a rush on its share value collapsing to NIL. I suspect many a creditor will be considering wanting their money back and we all know what then happens!
You cannot operate this business model without investment. You have no public presence if you cut marketing, against the competition in an extremely competitive market that fluctuates and says it all ‘trying to buy your business’ which is the worst salesman practice proved to fold a company time and time again. So many have gone before and failed, big time.
It will not surprise me if any creditors? do not end up shutting them down.
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More disruption and a continuance of the downgrading of the business. Not good news for anyone, the public or estate agents.
What about this false comparison with fees of 1.5%?
Being ‘Strike’, it is my guess they see this as a double benefit, agency fees as well as referral fees.
It won’t work, who is going to invest in a failed concept, so they will run out of money before long, as well as having taken on the ongoing liabilities and impending legal actions against Purple Bricks
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I think most of us are missing the plot here. Its got nothing to do with if the PB/Strike new allegiance is successful, the aim here is to see how much the director(s) can skim off the top before the **** hits the final fan, which it will.
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Love it!!! This move will bring down Strike and PB in one swoop.
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The only way this can work, if at all, is for Strike/PB to spend a huge amount of money on marketing etc This level of fee requires very big numbers. Am sure they will very rapidly add to their already £72,000,000 of losses, until at some point their investors say enough is enough !
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I think calling yourself a disruptor after 9 years of burning other peoples money and then being sold for £1 is a complete joke. You’re not a disruptor, you’re a failure.
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