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Graham Awards

TODAY'S OTHER NEWS

Yes Purplebricks - but how many homes do you actually SELL?

Mystery still surrounds the number of homes actually sold by Purplebricks, despite upbeat statements regarding the number of instructions it wins.

The agency’s long-standing nemesis - housing analyst Anthony Codling - has returned to the fray, questioning how good its most recent trading figures actually are.

Yesterday Purplebricks said it enjoyed a rise of almost eight per cent in instructions in the first half of its financial year, with revenue per instruction rising three per cent.

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It also revealed that its cash position was relatively strong on the back of the sale of its Canadian business - the last overseas venture the agency ended as it retrenched.

But Codling, who now runs PropTech platform Twindig and was an analyst at international investment consultancy Jefferies, says a vital ingredient has been missed by Purplebricks.

“As ever, the key missing metric is how many homes have been sold, but with up-front fee models, you pay your money and takes your choice” he says.

And he continues: “Let’s hope that those looking to meet the stamp duty holiday deadline have made the right choice.”

He points out that Purplebricks will know how many homes it actually and legally sells because the legal completion of a home sale is one of the triggers for payment of the £999 or £1,499 instruction fee for those customers choosing the pay-later option. 

In early 2018, when working at Jefferies, Codling conducted an extensive analysis of Purplebricks inventory at the time and concluded that it actually sold only 50 per cent of the properties it advertised online.

This was far below the 88 per cent figure which Purplebricks’ former global chief executive Michael Bruce cited.

"Do you really want to pay £1,000 whether or not you sell your property?" Codling asked at the time.

Purplebricks refuted his analysis in 2018. Then last year the former UK chief executive of the agency - Lee Wainwright - said the 50 per cent claim “simply isn’t true.”

“I can assure you the numbers that have been shared [80 per cent or more] are accurate” said Wainwright last year, adding that he “felt very comfortable being the voice of Purplebricks” defending such figures in the media.

Estate Agent Today has this week asked the agency to say what proportion of its instructions it goes on to sell, to get an updated position. However, the agency says it does not comment on this issue.

  • Carl Smales

    Their silence is deafening!

  • Guy Medd

    Er. They don't need to sell homes do they!

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    EXACTLY!

     
  • Chris Arnold

    Transparency is fundamental to trust. Its an issue that PurpleBricks could easily put to bed should they so choose. Not for the benefit of competing agencies, but for consumers. That they are afraid to release those figures says much about the culture therein.

  • Samantha Sullivan

    Back in the Bruce days it was over 80% but now, in the area I grew it is less than 50%. Since the change of managment and the 'list them at any price, list, list, list' direction, the customer service and goal to sell has been lost. It's really hard watching what I grew pretty much disolve over the last 18 months.

  • icon

    ' it was over 80%'. Sure it was.

  • Mark Walmsley

    Ive been in the business for 20 years and been an owner director of a successful agency too. I’ve been instructed on over 110 properties with Purplebricks since mid February and have sold over 95. Many have completed and a number still refuse to reduce, a problem endemic with “nsnf”agents far more than those who are motivated with a pay up front or “pay regardless” model.

    How any professional has time to spend over analysing another agencies business is beyond me. The PB (or online/hybrid model) is not a complicated one so what is the point?

  • David Bennett

    PB and upfront fee agents, have no incentive to sell. The brilliant business model, is grab the money, list on Rightmove and move on to the next gullible seller, who thinks they are saving high % fees. And who does the sales progression, after an agreed sale? Let's face it, who wouldn't like £500 up front, to help towards the outgoings. If high street agents took a fee deposit, on instruction and a lower % on sale, everyone would win. Happy Christmas.

    Mike Riley

    The agent may not be incentivised, but because of the up front cost, the seller is and that's what sells property.

     
  • David Bennett

    Why should PB publish their sales figures. Do you?

  • Andrew Stanton CEO Proptech-PR    Proptech Real Estate Influencer

    If you want the exact figures for Purplebricks for 2020, Graham, just email me - as I am an industry analyst I have all the stats, eg, listing figures are in excess of 60,000, I can give you sstc, cancellations, withdrawals and exchanges - I would have thought Mr Twindig would have the same intel - maybe he is just being shy .. chortle. Merry Christmas one and all.

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