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TODAY'S OTHER NEWS

In praise of Purplebricks: old-school agent insists "it's the way forward"

A traditional property agent says critics of Purplebricks underestimate the beneficial impact the firm has had on the UK agency industry.

And he insists that without the hybrid firm the sales and lettings sectors would not have progressed and improved as much as it has.

David Alexander - who set up property management firm D J Alexander 37 years ago - says Purplebricks transformed a sector that was not responding to the technological changes which were occurring in other markets.

In just a few years the hybrid firm has “identified and implemented the way forward for selling and renting.”

He adds: “Purplebricks have been subject to strong criticism by the sector since they began in 2014 with many believing that the business model was wrong, that the market would never take to a largely online delivery, that their expansion was too rapid, that their growth was funded by marketing rather than sales, and that it would not deliver profits.”

Alexander accepts that some of the criticisms were justified and mistakes were made, but insists: “The fundamental change which Purplebricks helped initiate was right, it will work in some form, and it is the future for our industry.”

He believes that while many agents believe it’s still necessary to have bricks and mortar branches, the reality is quite different and there has been a “continued collapse in bricks and mortars outlets across all sectors in retail, casual dining and estate agents.”

And he goes on to say: “Many in the [agency] industry recognised that change was coming, and online outlets were developing but none delivered the transformation in such a complete and transformative way as Purplebricks. They took the online model and exploded onto the estate and letting agent scene changing it forever.”

Alexander believes Purplebricks is only the start of what he describes as “this transformation we can build on” and says the best agents will have learnt from the lessons of Purplebricks since 2014. 

“The way in which lettings and sales will be delivered will vary but integral to it all will be an innovative platform accessible to all concerned; a face to face service provided by experienced staff on the ground but without the need for a local office; and a forward thinking management that can see, if the lessons of Purplebricks are learned, that the future is bright.”

  • Chris Arnold

    Check out "The Six D's of Exponential Growth" and it becomes clear where estate agency is now headed.

  • Simon Shinerock

    While it’s true that we have historically had a proliferation of high st agents, most of whom offer an inferior service, that doesn’t mean the PB model is better. Cheap alternatives to great High St agents may wipe out the weak variety but the ones who step up will still provide an added value service which will more than pay for their High St locations

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    People are seduced by the low fees as well as over-valuing by agents. They only find out how poor the service is months down the line when they have to do their own viewings or the property is still on the market after 2 years. This is not providing a good service for the client but by then it is too late.

  • Andrew Stanton Estate Agency Insights Strategies

    Which parts of the Purplebrick model are you alluding to David, that has moved the industry on?

    The 90M it burnt through in its last trading year, the 52M loss it made during the same period, the 'self-employed' LPE's who have no other work but to work for Purplebricks, and so have no holiday pay, sickness cover and are liable for any compliance issues, or is it the pay upfront sale or no sale model that you particularly like?

    Purplebricks certainly is a Behemoth in the world of Proptech, but it is more a Frankenstein monster created in a Tech Lab, than a useful addition to the industry, its starting premise is all wrong, how do we create a company that has a massive cashflow at the front end. I talk daily with lots of people in the Proptech world, and they are revolutionising the whole thing, they have true vision, they are not just digitalizing the whole system, they are re-crafting it, making it fit for purpose.

    If you want to praise anything for the advances in the industry I would start with the brave bankers, investors and private individuals who are backing the real tech revolution, not some frightening giant monster which is casting a purple shadow.

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