Purplebricks has announced that it is to reduce its up-front fee of £999 this Autumn following an in-depth pricing study, CEO Vic Darvey has revealed in the hybrid agency’s annual results.
He also says the company is looking at splitting the payment between listing and completion, lowering the cost of instructing the company but raising the overall fee.
“Reducing the upfront fee will reduce the barrier for many customers in instructing us – while higher fees on completion will allow our LPEs to earn more from each sale, ensuring our self-employed model will not only remain sustainable but become more attractive to the best talent in the industry,” he says.
Anthony Codling (left) CEO of Twindig, says: “Is ‘pay now perhaps sell later’ coming to an end?
“Paying whether or not you sell was always going to be a hard sell in a tough market; Purplebricks instructions fell 23% in the year to 30 April 2020 that’s a very significant fall when the majority of that year was not impacted by COVID.”
Purplebricks has put a brave face on its latest results which, as well as lower instructions, reveals declining revenues and profits in the UK.
The company’s revenue per instruction was the only bright spot in its financial and annual report which covers its trading during the 12 months to April 30th. This increased by 12% to £1,394. But otherwise revenue dropped by 11% and EBITDA by 53% to £4.2 million.
On a group level, the company continues to lose money and its latest results show a loss of £19.2 million as the closure of its US and Australia operations continue to weigh down on its finances, although if its overseas costs are taking out, it only lost £1.8 million.
The company is also racing through its cash reserves – which dropped from £62.8 million to £30.1 million.