How do Purple bricks make money? Unlike traditional estate agents that charge commission-based fees, Purplebricks follows a flat-fee, upfront payment model. Sellers pay a set fee before listing their property, ensuring Purplebricks earns revenue regardless of the sale outcome.
This article explores Purplebricks’ pricing structure, additional charges for premium services, and how it compares to conventional estate agents. We also discuss the pros and cons, including cost savings, risks of upfront fees, and customer experiences.
Whether you’re looking for an affordable way to sell your home or comparing estate agent models, this guide provides key insights into how Purplebricks operates and whether it’s the right choice for you. Read on to understand the full picture before making your decision.
How Do Purple Bricks Make Money?
Purplebricks operates on a distinct business model that sets it apart from traditional high-street estate agents. Unlike conventional real estate agencies that maintain physical offices and charge commission-based fees, Purplebricks functions as an online platform, streamlining the property selling process while reducing operational costs. This allows it to offer lower, fixed fees compared to traditional estate agents, making it an attractive choice for many sellers.
The Purplebricks Business Model
Purplebricks generates revenue by charging sellers upfront, flat-rate fees rather than taking a commission on the final sale price. This differs significantly from conventional estate agents, who typically charge a percentage of the selling price and only receive payment once a sale is completed.
Traditional estate agents provide services without requiring an initial payment, collecting their commission once the sale is finalized. This commission is usually deducted from the total sale amount before the remaining funds are transferred to the seller. Purplebricks, on the other hand, ensures revenue regardless of whether the property sells, thanks to its upfront pricing structure.
Upfront, Fixed Fees
The core of Purplebricks’ revenue model is its upfront, flat-rate pricing structure. Sellers must pay a predetermined fee before their property is listed on the market. This model provides clarity on costs from the outset, preventing unexpected expenses.
A key advantage of this pricing approach is that it often results in lower fees for sellers, particularly those with higher-value properties. Unlike commission-based estate agents, who charge a percentage of the final sale price (which increases as the property value rises), Purplebricks offers a standard fee, making it cost-effective for owners of more expensive homes.
However, the main drawback of this model is that sellers must pay the fee regardless of whether the home sells or not. While this reduces overall costs for many, it introduces a risk of financial loss if a sale does not go through. To mitigate this, Purplebricks allows sellers to defer their upfront payment if they use its conveyancing services.
How Much Does Purplebricks Charge?
Purplebricks’ fees are structured as follows:
- £899 for listing a property outside London.
- £1,399 for properties located in London and select surrounding areas.
- These fees are one-time payments and allow the listing to remain on the market indefinitely until the property is sold.
Although these rates appear competitive, additional costs may apply, including:
- Energy Performance Certificate (EPC): £84
- Premium listing on Rightmove: £125
- Featured listing on Rightmove: £149
- Accompanied viewings (standard regions): £300
- Accompanied viewings (London): £399
Sellers who prefer not to conduct viewings themselves must pay for an agent to handle this service, adding to the overall cost.
What Do You Get for Your Money?
Purplebricks provides a comprehensive package that includes:
- Listings on major property websites such as Rightmove, Zoopla, and PrimeLocation.
- Professional marketing photos and a floor plan.
- A dedicated local expert to manage the account, arrange viewings, and handle negotiations.
- A ‘For Sale’ sign, which not all online estate agents include.
- Social media marketing support.
The Pros and Cons of Purplebricks
While Purplebricks’ model presents an attractive alternative to traditional estate agents, it does come with both advantages and drawbacks. Here’s a closer look at the benefits and potential downsides:
Pros:
- Lower costs: Fixed fees often result in significant savings for homeowners, especially those with higher-value properties.
- Transparency: Upfront pricing eliminates surprises, allowing sellers to know their expenses from the start.
- Unlimited listing duration: Unlike traditional agents, who may impose time limits, Purplebricks allows sellers to keep their listing active until the property sells.
- User-friendly platform: The online nature of Purplebricks makes it easy for sellers to manage their listings, communicate with potential buyers, and track their property’s progress.
Cons:
- Upfront fees: Sellers must pay before the sale occurs, meaning there is no guarantee of a return on investment.
- Limited local presence: Without physical branches, some customers may feel a lack of personalized service compared to traditional estate agents.
- Additional costs: Essential services like accompanied viewings and featured listings incur extra charges, which can add up quickly.
- Mixed customer reviews: Some sellers report dissatisfaction with the level of support they receive, particularly regarding communication and negotiation assistance.
Purplebricks vs. Traditional Estate Agents
One of the biggest questions for home sellers is whether to opt for an online platform like Purplebricks or stick with a conventional estate agent. Here’s how they compare:
| Feature | Purplebricks | Traditional Estate Agents |
|---|---|---|
| Pricing Model | Flat-rate fee | Percentage commission |
| Payment Structure | Upfront | After-sale is completed |
| Service Scope | Online-based support | In-person & office support |
| Viewings | DIY or extra cost | Included in the commission fee |
| Market Reach | Online listings | Local & online presence |
| Support Level | Remote assistance | Personalized service |
For budget-conscious sellers who are comfortable managing aspects of the sale themselves, Purplebricks provides an economical alternative. However, those seeking a more hands-on approach with full-service support might still prefer traditional estate agents.
Can You Get a Refund if Your Home Doesn’t Sell?
One common concern with Purplebricks is the lack of a money-back guarantee. Unlike traditional agents who only charge upon sale completion, Purplebricks requires upfront payment, meaning the fee is non-refundable even if the property remains unsold. While this may seem like a disadvantage, the ability to defer payments through their conveyancing service helps mitigate the risk.
Customer Reviews and Reputation
Purplebricks has received mixed reviews from customers. While some appreciate the affordability and convenience, others have raised concerns about customer service and the effectiveness of their local property experts. Before committing, sellers should research user experiences and weigh the pros and cons carefully.
Conclusion
So, how do purple bricks make money? The answer lies in their upfront, fixed-fee structure, which ensures revenue regardless of whether a property sells. Unlike traditional estate agents who only earn a commission upon successful sales, Purplebricks secures payment before the marketing process even begins. This model offers cost savings formany sellers, particularly those with higher-value homes, but comes with the risk of paying fees without a guaranteed sale.
By offering additional premium services such as featured listings, accompanied viewings, and conveyancing, Purplebricks further boosts its earnings while providing sellers with optional add-ons to enhance their property’s visibility and appeal.
Ultimately, how do purple bricks make money is best suited for sellers who prefer a lower-cost, DIY approach to selling their home. While it may not be ideal for everyone, particularly those seeking hands-on, traditional support, it remains a strong alternative in the modern real estate market.
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