Purplebricks is again and can promote your own home for FREE. Is it any good?

Purplebricks looked like a firm that was going out of business this time last year. Its share price fell from a high of 487p in 2018 to 0.31p in May 2023.

Its collapse was avoided when it was rescued by rival Strike, which assumed its liabilities for the princely sum of £1.

Its fixed-fee model, famous for undercutting high street agent fees and saving home sellers money, appeared to have failed. 

But fast forward 12 months and Purplebricks is making a comeback – and hoping to attract customers by letting them list their home without paying a penny.

How much does Purplebricks cost? 

Purplebricks previously charged a fixed fee of £1,349 (including VAT), rising to £2,999 for those based in and around London. This needed to be paid upfront or no later than 10 months after the property was first advertised, even if it did not sell.

Now under the stewardship of its new chief executive, Sam Mitchell, it has changed that model.

It is only the basic selling package that is free, with homeowners able to pay for extra services if they choose. 

With the free package, Purplebricks says it will take care of valuations, list the property on Zoopla – though not Rightmove – and handle sales negotiations. It also includes an account manager to help guide sellers through the process.

There are two paid-for packages. Boost, which costs £899 with optional extras and Full House which costs £1,499.

The Boost service includes photos a floorplan, and a premium Rightmove listing, while Full House includes Purplebricks taking care of hosting viewings and also providing mortgage advice.

Those using the free package also have the option to add these extras for a fee. 

How does Purplebricks compare among estate agents?

The fees charged by UK high street agents – the industry term for those who have a physical office – are among the lowest in the world.

The average estate agent fee is currently 1.42 per cent of the final selling price, according to HomeOwners Alliance. That would mean if a property sells for £250,000, the owner could expect to pay around £3,550.

But estate agent fees vary wildly and can be anywhere between 0.5 per cent and 3.6 per cent, not including the additional 20 per cent VAT required on top.

Someone selling their £250,000 home with an agent charging a 3 per cent fee plus VAT would end up paying £9,000.

For those selling more expensive homes, even a fairly average 1.5 per cent plus VAT fee (totalling 1.8 per cent) can eat up more than £10,000. Sell a £750,000 property with that fee and the agent will take a £13,500 cut.

Sam Mitchell, chief executive of Purplebricks says: ‘We think estate agent commission – the percentage of sale price of a home – is a poor way of paying for estate agency services.

‘It implies that work by an estate agent differs according to the price of your home, which simply isn’t true.

‘The work required to value, list, market and negotiate a home remains similar each time.

‘With Purplebricks’ pricing model, customers pay far less than commission via a high street agent on average, and know exactly what they’re paying for.’

However, the big difference is that high street agents fees are typically only payable if the property sells. 

With Purplebricks, that is not the case. The fee is fixed, and paid in full at the point your property is put on the market. 

Angela Kerr, a director at property advice website HomeOwners Alliance, says: ‘You need to do the maths and think about the implication of paying upfront.

‘A high street estate agent’s fee is payable on completion. So no sale, no fee. 

‘But with an online estate agent like Purplebricks, if you decide to opt for a paid package or add-on optional extras, and your house hasn’t sold by the end of the six month marketing period, it will be delisted from the portals, you’ll lose that money and you will have to start again from scratch.’

What is Purplebricks’ sales record?

Purplebricks claims it has listed and sold more homes in the UK than any other estate agency brand so far this year.

It says it has listed 24,616 properties over the past 12 months, which works out as 100 sellers listing per day with Purplebricks.

It has a 3.7 star rating out of five on Trustpilot from 100,000 reviews. It also claims it has more 5 star TrustPilot reviews than any other estate agent.

It says it normally takes between eight and 10 weeks to sell a home with Purplebricks, which is broadly in line with the UK average.

This is the time it takes to go from being listed on an online portal to going under offer. 

Not all firms reveal this data, but the Countrywide estate agency network – which includes brands such as Bairstow Eves, Dixons and Hamptons – claims it is currently taking seven weeks to go under offer on average, which is slightly ahead of Purplebricks.

This may be something to bear in mind for those seeking a particularly speedy sale.  

While many homeowners will prefer the full-service approach of a high street agent, Sam Mitchell argues the Purplebricks service is about empowering people to have more say over what they pay when selling their home.

‘The high street model may work better for some,’ he says. ‘But people don’t all want the same things from their house sale.

‘We believe customers shouldn’t have to pay for services that they don’t want or need, and should instead be empowered to choose what’s right for them, allowing them to control their costs.

‘In doing so, Purplebricks sells more houses than those offering ‘no sale, no fee’ and charges a third of the average cost for doing it.’

Angela Kerr, at HomeOwners Alliance, thinks the Purplebricks’ offer to sell a house for free will be appealing to those who have been left unimpressed by estate agents in the past. 

She says: ‘Moving home is ridiculously expensive. In a world where everything is getting more expensive, it’s no surprise people are looking to pay less.

‘I think their free offer will be especially appealing if you’ve sold a house before and had a terrible experience with a high street estate agent.

‘It’s common for homeowners to feel they paid thousands of pounds for nothing, that they could have sold their house better themselves, and that Rightmove and Zoopla are what really secured their buyer.’

However Kerr questions whether sellers should rely on valuations given by online agents such as Purplebricks.

She says: ‘Our advice to homesellers is not to rely on any online estate agent for an accurate valuation.

‘Online estate agents may not have the local knowledge and may rely on online data. So we always advise getting a few local high street estate agents to value your home, alongside valuations you receive from any online agents.

‘Your high street agent is likely to know your local housing market better than anyone else so will be well-equipped to give you a realistic valuation.

‘Invite at least three agents round to value the property and discuss marketing. If they’re a good salesperson, they may even convince you to use them. But don’t forget to negotiate the fee.’

Why you should consider a high street agent

While cutting back on fees may appeal to some people, there will be many who prefer to stick with the traditional high street agent.

The right estate agent can make selling a home a relative breeze, just as much as the wrong one can cause problems, drag the process out and end up forcing a seller to reduce their asking price.

Marc Von Grundherr, director at Benhams & Reeves estate agency, questions the quality of service that customers receive from ‘low fee’ firms such as Purplebricks.

‘With estate agents, as with all things, you get what you pay for,’ says Von Grundherr.

‘Your relationship with your agent will be some six months or more long, and so it’s vital that you choose someone who is competent and communicative.

‘Getting a percentage commission on the sale also incentivises them to get you the highest price possible.’

‘Much of the Purplebricks model relies on upselling and commissions from third parties, such as selling mortgages and legal services.

‘Unless you are trying to sell for free, Purplebricks get paid regardless and so they have little if any incentive to work that much harder. High street agents do.’

He also rates high street agents’ physical presence in the local town centre.  

‘Having an agent that you can go to see at will is important for accountability,’ Von Grundherr adds. 

‘A property sale is too valuable to be left to a call centre. Local knowledge is rated as the highest criteria by sellers when choosing an estate agent, and therefore a local bench office with experienced local people is always superior to a national online business.’

Jonathan Hopper, chief executive of the buying agency Garrington Property Finders thinks that having a good high street agent is even more important when the property market is languishing, like it is now.

‘Selling a home in any market – let alone the current slower-paced market – takes time, skill and effort, and as a seller you really need your estate agent’s interests to be aligned with yours,’ says Hopper.

‘That’s why the traditional, commission-based model that Purplebricks sought to undermine still has value.

‘It stands to reason that estate agents who are motivated by a model that only rewards them when they successfully sell a home – rather than just taking pictures and listing it on a property portal – have a powerful incentive to get your sale across the line.

However, Sam Mitchell of Purplebricks argues that sellers can choose to have a similar service to high street agents, while saving significantly on cost.

‘Sellers can opt for different packages, with the Full House package including hosted viewings from a local property partner,’ says Mitchell.

‘For those that prefer to keep completely distant from the sales process, there’s still the option to do so.

‘That being said, Purplebricks can also offer a direct relationship between buyer and seller that other high-street agents don’t, through its online platform and app.

‘We believe strongly in creating a more transparent relationship between the agent and those involved in the process.

‘We find that by removing the gatekeeper role of the average local high-street agent and facilitating direct communication between the two from the outset, we achieve better outcomes.

‘Instead, we offer dedicated account managers that deal with the complexities whilst maintaining transparency throughout the process.’

Should you sell your home for free?

As tempting as it might be to take Purplebricks up on its free offer, there are limitations that could ultimately inhibit someone’s chances of selling or getting the best possible price. 

‘In terms of packages, I would say the Purplebricks free package is limited and misses some essentials,’ says Angela Kerr.

‘Most notably, it doesn’t include professional photos and floorplans. And while your listing will go on Zoopla, you need to pay extra to list it on Rightmove too.

‘You want as many eyeballs on your property as possible so ideally your home would be listed on both.’

‘It’s worth noting that using Purplebricks – even with their free package – entails a separate £60 anti-money laundering fee. Most high street agents will do AML checks in-house for far less.

‘The free model is still an appealing option for people who want to be in control of their house sale, are happy to be responsible for photos and floorplans and book and conduct viewings in the app themselves, and are ok with all the time and effort this takes.’