The chairman of LonRes says online estate agents have only a one per cent share of the market in prime central London.
Writing in his company’s summer market review, William Carrington refers to “the online presence of the market leader, Purplebricks” and cites recent analyses of both that agency and the wider UK online sector by international real estate consultant Mike DelPrete.
Carrington says that whereas DelPrete regards Purplebricks as “materially profitable in the UK – at scale” the challenge for the hybrid agency is to demonstrate growth even in the current shrinking market for housing transactions in the UK.
“As far as I can see there is no reason why an online offering would be any more immune than a traditional agent to the vagaries of a diminishing market” Carrington adds.
He also notes that DelPrete’s analysis makes no reference to prime central London where - Carrington states - the threat posed by the online agent is not growing at all, with just under one per cent of market share.
He says this is significant because PCL “generates the most revenue of any of the residential markets in the UK.”
He also adds that in the US, where Purplebricks recently launched, their offering is not the cheapest in a crowded market place.
“With the cost to Purplebricks running at $21,482 per listing, I do not see them making any significant inroads into the New York City” concludes Carrington.
His full editorial covering Brexit, the housing minister merry-go-round and other issues can be read here.