It is two years since hybrid estate agency Purplebricks launched in the UK and since then the company has recruited more than 300 Local Experts, grown revenues to £18.6 million, grabbed a two percent market share and recently claimed a property book value of £2.76 billion.
It’s all come at a heavy price. Marketing and advertising costs this year will increase its annual losses to £11.9 million, up from £5.4 million the year before. But the ambitions of backer Neil Woodford and founding brothers Michael and Kenny Bruce seem to know no bounds. As well as predicting a turnover of £73 million and profits of £44m by 2018, it has just been announced that Purplebricks has officially launched in Australia.
It will initially focus on two of the country’s juiciest property markets, Melbourne and Brisbane, before rolling out further afield.
In its statement released today Purplebricks says Australia’s traditional model of charging 2.2% of the sales value plus marketing-costs makes its offering a ‘compelling proposition’. The company is charging vendors a flat fee of Aus$5,400 to include photography, marketing and advertising on the main Australian portals.
“Australia is a natural second market for us to target. It is a large and fiercely competitive real estate environment, but one where sellers are currently receiving poor value for money,” says Michael Bruce, pictured left.
“We will offer the Australian public far greater transparency and a fairer way to sell their homes. We are very excited about the size of the market opportunity there, and believe that the expansion outside of the UK provides both additional returns for investors and the benefit of diversified income streams.”
Purplebricks is to spend £10m on the launch and has hired Ryan Dinsdale, who has a background in customer loyalty and marketing, as CEO to lead the charge.