It looks as if Purplebricks has hit something less than a purple patch in the Australian housing market.
The Australian Financial Review, a financial publication that has run several extensively-researched pieces on the hybrid agency since it launched down under in 2016, says its local property experts in the country are leaving “in droves”.
It says at least 27 have quit since March with overall numbers down to just 88.
“Purplebricks territory owners (franchisees) and agents, who spoke to the Financial Review, said they were struggling to make a living and were preparing exit paths after the $100,000 to $180,000-a-year salaries they were told they could earn failed to materialise” the report claims.
“Employment contracts seen by the Financial Review show Australian agents earn just over $1,000 out of the $5,000 to $6,000 upfront fee vendors pay when they list” it continues.
Other paperwork seen by the publication suggest that 15 agents undertook a combined 768 home appraisals between February and April, but have so far secured just 189 listings between them.
It quotes one former Purplebricks agent, Steve Ashford - who quit the company last month - saying: "The concept is brilliant, but the business model is wrong for Australia … There is a big difference between what they promised us and what we achieved."
The publication says that while agents can in theory earn additional fees through sales of mortgages or other ancillary activity, “much of this additional income has vanished as franchisees have had to hire and pay sales assistants to help clear the backlog of listings.”
Purplebricks Australia chief executive Ryan Hinsdale is reported in the piece to have said more than 80 per cent of agents were earning a "good income".
"It's a new model in Australia with a new way of doing things so it won't suit everyone … We are really pleased with how the business in Australia is going" he says.
You can read the full piece here.