British real estate portal PurpleBricks has indicated it may make changes to its fees after admitting mistakes were made in its overseas expansion plans.

The company could change its current flat fee model from £1,399 ($1,712 U.S.) in London and £899 ($1,100 U.S.) elsewhere to a lower, more flexible fee that takes local market conditions into account.

“We’re going to start to look at how we evolve our pricing over time because our pricing has been pretty much the same for five years,” CEO Vic Darvey told the Press Association.  “With any successful business, you need to adapt and evolve your pricing strategy. It’s really important now that we become a brand that is famous for exceptional service, as well as category-leading fees.

“In certain markets, in certain pockets of the country where houses aren’t moving quickly, there is a moment of hesitation from customers saying: ‘I know I can save £10,000 but actually, do I want to commit to an £899 upfront fee when my house may not sell?’”

Property Industry Eye reports that PurpleBricks will be introducing a no sale, no fee fixed price of £1,995 including VAT, probably in the New Year, with the commission structure for local property experts changing. It’s expected there will still be an option to pay upfront, which is likely to go up by around £100.

PurpleBricks will now focus solely on the U.K. and Canada, where it operates through DuProprio/ComFree.

Darvey admitted that attempts to establish its business in Australia and the U.S. had been a mistake. “We were incredibly distracted by overseas expansion. We’ve admitted we made some mistakes,” Darvey said.

He wants to increase the PurpleBricks market share from its current level of around 3% to 10% within five years. He hopes to achieve this as traditional agencies decline in numbers and the share of the property market transacting online increases.

 

 

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