Purplebricks has lost nearly 20% of its local property experts in Australia over the past three months as the Oz property market shows down after years of booming prices and demand.
In its March annual results the company said it had 105 local property experts but now lists just 88 on its local website.
Interviews with local LPEs by The Australian Financial Review revealed that some were “struggling” to make a living and that the large salaries they had been told were achievable have been failing to materialise.
Purplebricks Australia CEO Ryan Dinsdale claimed that only 16 agents had quit since March, and said that 80% of agents were earning a good income.
Documents revealed during the investigation have also revealed the fee Australian LPEs earn, which is AUS$1,000 of the AUS$5,000-6,000 upfront fee vendors pay in Oz.
In New South Wales, which is the weakest property market in Australia at the moment, it was revealed that LPEs on average win 189 instructions for every 768 valuations, or just 24%.
Purplebricks has chosen a bad time to launch its business in Australia. After many years, and decades, of boom the Oz property market is showing signs of a meltdown.
Prices in Sydney and Melbourne are predicted to fall by 10% this year, not helped by many Australians’ love of interest-free loans. Many of these are now due to roll over into interest and capital repayment mortgages, leaving home owners and investors with much higher monthly payments, but properties that are reducing in value.
Overall prices in Australia dropped by 0.7% during the first three months of the year, including a 1.2% drop in Sydney and 1.1% fall in Darwin.
The picture for Purplebricks in the UK is rosier. In March it had 650 LPEs, a figure which has now increased to 674. Purplebricks in the US is yet to reveal how many LPEs it has.