Purplebricks – Why I Have A Love/Hate Relationship With Them

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Purplebricks – A good thing for Australian homeowners and the Real Estate industry OR are they merely a wolf in sheep’s clothing?

Unless you’ve been living under a rock, you’ve probably seen the Grimace coloured Purplebricks Real Estate adverts all over your television screens.

And with a rumoured advertising budget of around $18million, they’re spending an awful lot of money for you to notice them.

Whether you love or loathe what they do, you can’t deny that this U.K based company have created quite the divide when it comes to opinions on what they’re offering the Australian market.

As you can imagine, most local agents hate the idea of another big player coming into ‘their’ area and stealing ‘their’ commissions. Most don’t have a whole lot of nice things to say about Purple Bricks or the agents who work for them.

However, I kinda think their anger is a little misplaced.

As an agent who is in direct competition with Purplebricks, I actually believe that their arrival is good for the marketplace. However, like most big companies there will always be some parts of their business model or service offering that focus on profit rather than the product, and they do well to keep that hidden from their customers.

I wanted to give an honest appraisal of what I believe to be both the Pro’s and Con’s of Purplebricks. What I love about them and what I hate about them. 

Love Hate Purplebricks

In some respects, I truly love what they’re doing, and I wish them all the best, but then on the flip side I can’t help but feel that they may be doing their clients a huge disservice without even realising it.


First and foremost they stand out as being an extremely affordable (some say too cheap) option. Especially when you compared them to the standard crazy commissions that the local agents have been charging for decades. This, I believe is a good thing, particularly for homeowners who need to keep as much money in their pockets as possible.

They offer a very similar service on paper to that of your local agent, except they charge a flat fee of around $4,900 – $6,500 depending on how you sell (Private Treaty or Auction) and which states you’re located.

As part of their ‘flat-fee’ offering Purplebricks include a basic marketing package of professional photos, advertising script, For Sale Sign, floor plans and on-line advertising on the major real estate websites. This pretty much gives you the bare-bones of what you need to attract buyers to your home.

Like us, they involve the owner in the sale of their property by having them show buyers through their home. We love this as it creates a level of transparency that the traditional model doesn’t offer.

They’re great at promoting themselves. But who wouldn’t be with a multi-million dollar budget to spend?

Their branding, especially the use of the colour purple and their catchy T.V and radio jingles is hard to ignore. I’ve had many friends mention to me that they’ve seen their adverts. They’ve got people talking, thinking and taking notice.

But what I really like about these guys, and why I’m glad they’re here, is this;

They’re making agents nervous (or at least the ones that deserve to be nervous).

Disrupting the real estate industry has been a hot topic for years. Everyone has been speculating on how this would happen. The For Sale By Owner, DIY space, has been trying this for years, but it’s never really managed to grab any substantial share of the market.

Yet along comes this U.K giant Purplebricks and they tell us they’re here to ‘Shake things up’. And it’s exactly what they’re doing. I personally believe this needed to happen. Someone needed to ‘shake things up’ and provoke some real change in the industry. I welcome this new player and I truly hope they force Australian homeowners to give a little more consideration to how they sell and buy property.

Now don’t get me wrong. There are many agents out there, operating under the traditional real estate model, doing their very best for their clients. However, overall, Australian real estate agents have a bad reputation when it comes to trust, credibility and client satisfaction.

To be perfectly honest, I believe many agents actually deserve that label as they have been riding the coattails of a property boom, treating their clients badly and taking advantage of them for way too long.

Trust in Real Estate professionals is at an all-time low. The idea that a new player has the potential to influence how the game is played is fantastic. To have homeowners questioning what their agents are actually doing for their hefty commissions, is an excellent thing in my book.

As I mentioned earlier, Purplebricks have a rumoured $18million advertising budget which is helping them spread the word and educate Australian property owners. They want to show us that there is in fact, for lack of a better term, more than one way to skin a cat. The local agent, with their outdated shopfront window, is no longer your only option.

So as an independent agent, you’re probably wondering why I’d be happy that my competitor has an advertising budget that dwarfs mine 200 times over?

Because I want them to re-educate the Australian public.

If people look a little further than your big local franchises like Ray White, McGrath, or LJ Hooker they’d be amazed at the different ways they can sell their home, save money and still achieve fantastic results.

I want them to show homeowners what is now possible in 2017 and it’s for this reason alone I believe Purplebricks is the disruption the Australian real estate industry needed to have.


Unfortunately, it’s not all sunshine and lollipops. There are a few things about this model that I’m not a fan of.

For the general public who aren’t aware, Purplebricks operates differently from your standard ‘performance based ‘agent. I guess you’d call them more of a ‘Listing agency’ as opposed to a ‘Selling agency’ and this is a very important distinction if you’re looking to use their service.


Well, it means their entire business model and service is built around incentivising agents to list your property for sale with them, not to actually get your property sold.

HUGE difference!

This is a big one that many homeowners tend to miss. They get all wrapped up in the idea of having a so-called ‘local area expert’ sell their home for them, for as little as $5k, that they forget what’s actually going to help them get the best overall result.

So what does that actually mean for you?

First of all, most people don’t realise this but you will pay Purplebricks their full fee even if you don’t sell your home. Which is TERRIBLE! Our clients pay us NOTHING unless we can deliver them the result they hired us for. 

Recent data indicates that around 20-30% of properties fail to sell the first time they’re listed on the market. That means roughly 2-3 out of every 10 Purplebricks cients could potential walk away $5000 out of pocket and with a home still for sale.

However, my biggest bugbear with their model is the fact that there is no real incentive for the agent, who’s looking after your property sale, to get it sold. There is no drive for them to actually work hard as they get paid when they list your home, not when they sell it.

You’re relying on them being a decent and honest agent. You’re hoping they’ll put the hours in and do all the little things they should be doing in order to get you the very best result.

Whilst I’m sure they have some great people working for them, who genuinely want to see your property sell for a great price, they’re incentivised to do the opposite. They’re encouraged to move on and list another home, so they can get paid again, rather than getting your home sold.

Truth be told, selling property is harder than people think. There are long days and many phone calls, emails and SMS’s late at night to get deals done. However, the incentive is always there for your agent to put in the hard yards to get the deal done, otherwise, they don’t get paid.

As an agent, we are well aware that if we help you get the result you want (get your home sold for a great price) then we will also get what we want. To be paid fairly for our hard work and service.

The Purplebricks model doesn’t reward their agents for the hard work at the end of the deal, they reward them for the hard work (signing you up as a client) at the beginning of the deal. In a nutshell, they reward their agents for telling you exactly what you want to hear at the listing presentation and getting you to sign on the dotted line.

The talk amongst agents who aren’t working for Purplebricks suggests the calibre of the real estate agents they’re attracting isn’t of the highest quality. Agents that couldn’t make it on their own. Now I can’t comment on this as I don’t personally know any agent working for them, however, I can understand the thinking behind this opinion.

Now whether or not this is actually the case, I can appreciate why some agents have chosen this path. I think many were probably just fed up and wanted a change, and Purplebricks provided that. A little like the people of the U.S voting in President Donald Trump. Whether it’s right or wrong, sometimes change just feels like the only way forward.

So how will you as a homeowner know if Purplebricks is a fair and sound model for you to use when selling your home?

Maybe ask yourself this. Would you pay a builder his full fee up front to build your home, because they tell you they can get the job done, but they can’t provide you with any guarantees?


Would you pay him a small portion to start the job, and then once complete and they‘ve delivered the desired outcome you hired them for, you pay them the rest?

I know which I’d choose.

So I guess you could say I have a bit of a ‘Love’ ‘Hate’ thing going on with Purplebricks.

Overall I’m glad they’re here ‘shaking things up’.

I’m happy to see a new player come into the market and make some noise, ruffle a few feathers.

Competition is good in every industry. It helps to keep people honest. It means everyone has to step their game up to compete at a higher level and deliver a better service and outcome for their clients.

So if the infiltration of Purplebricks means Australian homeowners start getting a better service from whichever agent or real estate model they choose to sell with… I say bring it on!

[thrive_text_block color=”blue” headline=”Daniel Baxter | Co-Founder | Your Hot Property”] Daniel Baxter is one of the Co-founders of Your Hot Property, a licensed agent in NSW, QLD, VIC, & TAS, and is passionate about helping people sell their home and purchase their next one. Daniel is a big believer in involving the owner in the sale process and says that’s one of the key reasons he can achieve such great results for his clients. Since launching Your Hot Property Daniel has helped sell over $330 million worth of property across Australia and saved his clients over 8 million in expensive agent fees.[/thrive_text_block]