STAY CONNECTED!
    
newsletter-button

TODAY'S OTHER NEWS

Purplebricks could have 15% market share by 2022 according to bank

US bank J P Morgan has predicted that Purplebricks, which it says now has around six per cent of advertised homes to sell, could boost that share to 15 per cent by 2022.

Reporting the forecast, financial news service Proactive Investors says its analysis shows that the average UK fee for an online agent is 70 per cent lower than that of traditional agency rivals.

“The success of online agents is reducing the cost base and driving productivity in the estate agency industry, and JPM believes that this will most probably lead to reduced commissions for traditional agents” says Proactive Investors.

The bank also warns that Rightmove could ultimately be threatened by the rise of Purplebricks.

It says that agents will look to cust costs elsewhere before they sacrifice advertising on Rightmove but “it sees little scope for meaninfful increases in average revenue per agent” by the portal.

JPM, in a statement to investors, downgraded Rightmove but suggested that Purplebricks may have scope for substantial growth, not least because of its activities in the US and Australia in addition to the UK.

Purplebricks currently has a London stock market share price of around 425p but JPM puts its possible target as a huge 733p.

You can see the full article about the forecast here.

Meanwhile The Guardian’s personal finance editor Patrick Collinson, has made a striking contrast between Purplebricks and the troubled Countrywide.

He says Countrywide could, just about, cope with its current loss of business if that was down to purely cyclical problems - “the problem for Countrywide, and other high street chains, is the existential threats to their business” he says, making explicit reference to the contrasting listings volume and share price success of Purplebircks. 

“It is disintermediation, for so long successfully resisted by the agents, that is the potential death blow. High street travel agents were the early victims of the likes of Booking.com, Expedia and Trivago” he writes. 

“Estate agency has survived longer than anyone expected. We don’t know if it will be Purplebricks or another challenger that will be the ultimate winner in online home selling. What we do know is that the dam has broken and only the upmarket estate agents in the luxury and country home market are likely to survive the onslaught” he adds.

  • icon

    I booked a holiday on Sunday. I drove to Thomas Cook in York, sat down with the adviser and bought a holiday. She was informative and knowledgeable.i am happy to pay more for a better service. Basic holidays I don't mind booking on line but if I want something done 100% right I use professionals.

    icon

    A very good friend of mine is a property specialist at Purplebricks and he spend 15 years working at a firm of estate agents. Whats the difference? I understand every property expert there is an estate agent with lots of experience.

     
  • Simon shinerock

    If true, and 60% of sales agreed complete, it means the true cost of PB is actually over double the up front fee. If you are amongst the majority who fail to sell in this scenario you are left having to pay the full cost of an estate agent as well as your upfront fee. If the prices achieved by vendors selling with PB are also below those achieved by good local agents then it becomes a lose lose situation. We love PB, they have proven to be a fantastic source of instruction, we would rather compete with them than with a strong local agent

  • Sally Jones

    Totally agree Paul - they can spend millions on marketing but when your service is inferior to the real thing it will not last. I am sick of hearing 'experts' tell us how great they are, how much of the market they 'could' have in the future. We are often asked to value properties that Purplebricks have also been asked along to and we always win the instruction - it doesn't take much to shine when you are competing with these 'local property experts'!!!!

  • icon

    Overvaluing failed estate agents the majority of them.

icon

Please login to comment

valpal
submit
sign up