Disclaimer: These comments are the writer’s own and do not necessarily reflect the current opinions and policies of the Real Estate Institute of Western Australia.
When considering selling a property, about 1 per cent of all vendors choose to promote their property for sale themselves or with the limited assistance of service providers such as Buy My Place, For Sale By Owner, No agent Property, Go Private or –the latest of these players – Purple Bricks.
These groups are essentially running a web portal and offering limited advice and assistance to the vendor during the selling process. Purple Bricks is a little different in that a real estate agent is involved offering constrained services for a fee but it is, based on what I have seen, similar to for-sale-by-owner services already available.
Of course, Purple Bricks disputes this and claimed I had “defamed them” in an article in last weekend’s Financial Review. Purple Bricks offers a genuine low-price alternative to employing an agent in the usual manner, but it’s an insult to our intelligence to claim they’re “proper agents”.
Purple Bricks are “pseudo agents”. They are not “proper agents” like their TV ads claim. Importantly, “proper agents” are incentivised through the payment of a commission at settlement which ensures they work for their client from beginning to end to procure the best result possible. That is our responsibility by law. Appropriately, an agent that fails to complete their task doesn’t get paid. Comparatively, Purple Bricks charges no commissions but incentivises their agents to list your property for $4500 (including advertising), then effectively you’re on your own unless you pay for “extras”.
Ask yourself, would you seek out the cheapest plumber, painter, electrician or any other tradesperson and pay them up-front before they did the job? Of course not, but this is exactly what Purple Bricks expects you to do.
In my opinion, Purple Bricks are not behaving like Real Estate Agents. They are not properly negotiating the sale on behalf of the seller, taking on the risks nor managing the sale through to settlement because there’s no incentive for them to do so. They’re not even using REIWA and ACCC approved contract documents.
One on-line reviewer from Perth summed up his experience, “Completely lost interest once they had signed me up.” And another said, “The worst buying experience of our lives…left us and the seller to battle out issues.”
When the “agent” in incentivised by getting paid for your listing and not the result, what else should you expect?
by Hayden Groves
REIA Deputy President