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TODAY'S OTHER NEWS

Purplebricks under scrutiny as US watchdog discusses online agencies

The Federal Trade Commission - the US equivalent of the UK’s Competition and Markets Authority - will today discuss how the dawn of online agencies will affect consumers.

Unsurprisingly, Purplebricks will be under the spotlight as part of the analysis.

In a session to be held jointly with the US Department of Justice, the FTC will look at a series of issues includes how residential estate agency competition has changed in the past decade, whether internet-related technology has changed the landscape, and of course will consider fees and US-specific issues like the Multi-Listing System.

Purplebricks’ US chief executive Eric Eckhardt is reported to be one of the real estate experts to be giving evidence to the day-long series of workshops and investigations. 

Purplebricks launched in the United States in Los Angeles in September last year followed by Sacramento, San Diego and Fresno in January this year. More recently, in April, it launched in the New York Designated Market Area. 

Using a similar approach to that operating in the UK - except in the US Local Property Experts are Local Real Estate Experts - Purplebricks levies a flat fee of $3,200 to list a home and, upon completion, paying the buyer’s agent commission which is standard in US residential real estate transactions. 

Purplebricks claims that within the New York DMA - which includes more than 20 million people in select counties across New York, New Jersey and Connecticut - some traditional agents’ commissions reach as high as seven per cent. Therefore it says that a New York DMA owner selling a $560,000 home would save $13,600 with Purplebricks compared to paying the standard real estate brokerage commission. 

You can see details of today’s upcoming FTC deliberations in Washington DC here. That page also contains details of how you can see the day-long discussions streamed live.

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