Purplebricks has totally denied speculation that it has somehow been under investigation in America and hauled before the authorities to give responses. It says that the reports are simply wrong.
The denial follows a public workshop in America to explore competition issues in the residential real estate brokerage industry. Purplebricks said it had specifically been invited to participate, with its American CEO one of the panellists sharing experiences and opinions.
A specific objective of the workshop was to monitor whether there is effective and fair competition, and that online players are not being discriminated against.
This is an important and relevant issue in America.
Ten years ago, in 2008, the Department of Justice sued trade body the National Association of Realtors for anti-competitive practices, alleging that NAR was discriminating against online brokers by denying them access to multi-listing service data.
The workshop was held in Washington on Tuesday this week, put on jointly by the Federal Trade Commission and Department of Justice.
In the US, as in the UK, the industry has undergone significant change in recent years, including the emergence of new business models.
The workshop focused on developments since the FTC and DOJ published a report on competition in the real estate sector back in 2007.
Among those taking part was experienced realtor Eric Eckardt, now CEO of Purplebricks US.
He was a panellist at the workshop, discussing ‘developments in real estate fee and service models’.
Also taking part were Redfin, Zillow and Realogy. Attendees included consumer advocates, data standard experts, tradition realtors, information marketplaces, and multiple listing services.
A spokesperson for Purplebricks told EYE: “The workshop was in no way an investigation into, or scrutiny of, the Purplebricks business model as reported by some.
“Quite the contrary – we welcome it. The purposes of the workshop were indeed for the FTC and DOJ to develop their thinking on creating competition in the real estate market.”
Eckardt said he had been pleased to be invited as a panellist.
He said: “At Purplebricks, we are based on transparency and provide a cost-effective solution.
“Consumers know what they’re paying – a flat fee of $3600.”
A flat fee of $3,600 irrespective of if it sells. It still amazes me they can do it without having to declare clear risk warnings of ‘capital at risk’.
If you sell 80% of your homes, why not a fee of $4,500 no sale no fee too? We all know why they don’t.
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U.S. property prices are half that of the UK, living costs are 18% higher, why is the internet listing fee 297% more than over there?
If they can whack a listing on a portal for £900 over here $1500 ought to be enough to account for the higher cost of living, after all it is the cost of living that justifies the premium for London listings isn’t it?
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They are in the prime real estate areas of California and New York…so values are high and the realators can charge huge fees as we know 6-8%
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