Online agency Purplebricks has appointed advisers to prepare the company to be floated on the Stock Exchange less than a year after being launched.
The agency, set up by brothers Michael and Kenny Bruce who ran Burchell Edwards in the Midlands, is reported to have appointed a Canadian firm, Canaccord Genuity, to oversee preparation for the float. Canaccord has taken a keen interest in British agents and online activity in recent months, commenting frequently on the prospects for OnTheMarket prior to the launch of the portal.
London's Evening Standard newspaper says the selection of Canaccord following a beauty parade of potential advisers earlier this month and it appears likely that the marketing launch for the float will be as soon as May 1.
Estate Agent Today has previously reported that Purplebricks has had substantial investment from Neil Woodford, the former Invesco Perpetual star who put £7m into the agency last year, praising its disruptive' potential.
The agency is known to also have the backing of Goldman Sachs' head of investment banking, Anthony Gutman, and Paul Pindar, the former chief executive of outsourcing and business management firm Capita. Martin Bolland, Capita's non-executive chairman, also took a financial stake in the business. This is also new funding from Errol Damelin, the former boss of controversial payday lender Wonga.
So far Purplebricks operates across only half of England but has recently been making key appointments ahead of which is expected to be a national roll-out - using some of Woodford's investment - by mid-summer.
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Comments
2 words = Burchell Edwards!
i was offered a position at Purplebricks but poliety rejected as this was the prediction floating on the stock.
Perhaps anyone thinking of investing in Purple Bricks should remember what happened to Burchell Edwards and the 100's of people and suppiers that lost money!
I agree wholeheartedly - but the playing field has never been - nor will ever BE - level.
Most of the Agents in my neck of the woods advertise "Free Valuations" - and I'm sure you've come across the looks you get if you try to explain to a prospective vendor why your inspection is "an 'Appraisal' - NOT a 'valuation' ".
Ouch!
PLease see below the transcript of an online conversation I just had with Purple Bricks.
[Leon]
Welcome to Purplebricks. You can find answers to the most common questions on our website, simply visit https://www.purplebricks.com/home/faqs. My name is Leon, may I take your name please
[Visitor] Paul
[Visitor] Can I ask what standard of valuation you provide
[Leon] Hi Paul, the valuation consists of a full market appraisal, should you wish. We can take measurements, photos and everything on the visit as well as provide you with a valuation on the property.
[Visitor] So it will be by a RICS surveyor and I can use it for a mortgage
[Leon] It's by our local property expert, so it's a valuation based upon what we would market the property for, they're fully NAEA qualified.
[Visitor] That's an appraisal you offer a valuation, they are different
[Leon] We provide you with a property valuation, so this is a value we would like to achieve on the market for you.
[Visitor] I'm sorry a valuation is done by a RICS surveyor, you offer that free that's the one I would like. There is a big difference
[Leon] The valuation we provide is not from a surveyor, it's a valuation from your local property expert, the same form of valuation you would get from a local high street estate agent.
[Visitor] A local high street agent provides a Market Appraisal, not a valuation. If your firm offers a free valuation then that's what should be provided. Otherwise you are falsly advertising.
[Leon] Ok, I do apologise for any misunderstanding there. If you would like a free valuation, then I can arrange this for you.
[Visitor] By a RICS Surveyor
[Leon] It would be from our local property expert (estate agent) - not a RICS surveyor.
[Visitor] Like I said that is a Market Appraisal not a Surveyor, I want a free valuation done by a RICS Surveyor. What level do you provide
[Leon] In what you're wording, then it's a market appraisal. It isn't a valuation from a RICS surveyor.
[Visitor] The you are guilty of false advertising
[Visitor] I will look at sending this transcript to trading standards, for them to advise
@PeeBee But will they respond to this question we all know that as agents we offer appraisals, now if they are offering valuations they need to stop. A level playing field please. I like healthy competition from anyone be it online or high street. It makes good agents better, and the bad leave.
I am not a surveyor so wont offer a valuation.
Paul - I would suggest (and I trust you agree...) that the only response of relevance would be that of the company who are offering said "free valuation".
The rest of the industry cannot answer on behalf of another agent - can they
In response to Guest (Paul)...Yes you are right Paul strictly speaking Estate Agents would generally be providing a Market Appraisal when giving a potential seller advice on marketing their home and on what price their property is likely to achieve. This is of course different to a valuation that may be carried out by a surveyor providing a Valuation on behalf of a lender considering a property as security for a mortgage for instance. However, often such surveyors seek the advice of local agents who after all are operating at the front end of the market and more than anyone are likely to be in tune with what the market will stand at any given time for any given property in the local market.
@Guest (Paul)
There is a vast difference between a 'Market Appraisal' a 'Valuation' a 'Survey' and a 'Structural Survey'
In my view and knowledge a typical Agent only carries out a 'Market Appraisal', which is an estimate based usually on similar properties and their selling prices selling prices. If they use any other term it is just laziness and is hyping up the procedure.
Hi Not on the High Street. Whilst I agree that all things should be given time, a quick glance at the figures on EasyProperty's investment manifesto, followed by a few taps on the calculator tell you that they either need to start charging each client just shy of 3k ea, or significantly increase their listings if they are not to run out of cash before the end of the year. All these companies talk of listing before they've even established themselves in the market (if the market even exists!). I think this shows that the founders are looking to turn a quick quid.
I asked once before, and no one replied, They say they offer a free valuation, I know this is just playing with words, but I was always taught that Agents offer free market appraisals. Now if they have RICS employees working for them and they are doing valuations for free I may take them up on it. But what standard of survey are they doing.
Anyone want to actually answer this, or is everyone going to hide again.
Thanks
They appear to be quite successful in the south, but in my area, there are only 2 of their boards up, one of which has been up since last October. Another problem they have is that they allow the vendor to ultimately decide the asking price, which we all now is a [i]great[/i] idea . . . . .
I feel a short coming on.
The quick-buck brigade are back. They like to make a quick buck from vendors and now they are looking to make a quick buck on the stock market. It still surprises me that Neil Woodford is involved in this, but he must see something that I can't...
Give them time. They're still in the early stages of their development and they have some serious financial backing. It's not going to happen overnight.
Like Tepilo and EasyProperty, it will be a few more years until we can judge their success. I'm sure lots of people doubted Rightmove and Zoopla when they first started, the same is happening to OTM at the moment, but realistically it's far too soon to judge.
Lots of big bucks going into this, but the impact Purplebricks have had would appear to be minimal. You can pump all the money you like into something, if you don't have the mixture of nous, knowledge, experience and luck, you won't get very far.
Some big names and successful people have backed this venture, but as the poster below says, I fear it is doomed to failure.
Yep, given the amount of backing they've had, those figures are nothing to shout from the rooftops about. It's all gone very quiet on the EasyProperty front as well, I thought they were going to take over the world
It just goes to show, being successful in one arena doesn't mean you're necessarily going to be successful in another. Property is a whole different beast from aviation and investment banking, etc.
I accept that there are heavyweight backers behind this, but 2,000 sales @ 665 ea since launch is not exactly big money (similar to the turnover of a small London high street agent) + PurpleBricks are supposedly the biggest of the online disrupters!! My predictions are that EasyProperty will run out of cash before the end of the year and that PurpleBricks will survive the longest of the bunch, but will ultimately fail. There are other, far more lucrative opportunities in the property market for would be 'disrupters' seem to ignore. Similar levels of energy and capital, directed towards these opportunities would have the possibility of giving investors a return their trust deserves.