Fledgling online real estate challenger in the UK market PurpleBricks has reported revenues for 2015 to be around £18.5 million, a 445 per cent increase on 2014 figures, but declined to reveal how many homes it has helped sell or let.
The company, which said trading through the second half of the year was strong, is due to report its final results on June 16.
With a reported 6,941 listings on its website compared with 6,869 for Foxtons, (according to the FT), Purplebricks claims to be the fastest growing estate agent in the UK.
Launched in April 2014, the company provides sellers with a “Local Property Expert”, a freelance agent who values their home. Sellers can then decide to list their home on the Purplebricks platform for a fixed fee. The firm now has 205 LPEs dotted around the UK.
Purplebricks says it takes just 14 days on average, to sell a home, or six days, on average, to let a property. It also claims to save sellers an average of £4158.
Backed by high-profile fund manager Neil Woodford and Wonga founder Errol Damelin, the company is also the first British online estate agency to float on Aim, London’s junior market, with a market value of £240m.
Its shares have gone up by 70 per cent this and it has just launched in Scotland, says its plan to recruit more local property expert agents is ahead of schedule.
Chief Executive Michael Bruce says with solid underpinnings, momentum and the size of the market opportunity, we are confident in proving the business model and delivering value for all of our shareholders.”
In a recent interview with The Negotiator magazine, Bruce also describes Purplebricks as a hybrid agency, not to be included with the standard online newcomers.
“I think we’re very different from the other online agents,” he says. “From our perspective we’ve invested massively in technology and in people whereas the other online and non-traditional competitors haven’t quite done the same.”
Purplebricks charges a fixed £798 (up by 20 per cent from £665 in January 2014) plus value added tax, or £1,158 plus VAT in Greater London, chargeable whether or not a home is sold.
According to Property Drum, the fee is payable whether or not the property is sold, a factor which could make a significant difference to the numbers of homes sold or let.
“If the instruction fee of £798 for a sale is all that sellers need to pay, (for simplicity – leaving lettings out of the equation) they would have sold 23,182 homes, which would be impressive, but maybe unlikely,” Property Drum calculates.
“If just half of sellers took the extra ‘service’ of a For Sale board, that would reduce the sales number to 21,561, which still seems incredible.
“However, the website doesn’t divulge the extra cost for the mandatory EPC or for viewings, which could make a significant difference to the calculation.”
Despite this, analysts predict its sales will rise by another 150 per cent to £49.2m next year, with a maiden profit of £8m forecast.