DealMakerz | 21 June 2019

Is This The End For Online Agents

Two years ago the outlook for online and hybrid estate agents looked very rosy. Over £250 million in private and crowdfunded investment cash was rolling in and Purplebricks looked unassailable as it gained market share in the UK and footholds in both the US, Canada, Germany and Australia.

But now everything has changed. Purplebricks has quit Australia, cut some of its services, seen its market share increases come to a standstill in the UK, and it may yet disappear from the US.

Emoov and Tepilo collapsed into administration, Hatched was closed after being bought by Connells, House Network is struggling after nearly going bust and Yopa has been implementing cost cutting measures as its cash-burn has accelerated.

“This isn’t simply a matter of profitability though and I think the nation’s home sellers have woken up to the fact that if you pay a low fixed fee, the service will match the price and you might not even sell at the end of it,” says Marc von Grundherr of Benham & Reeves.

“There are many positives the traditional sector can take from the rise and fall of the online sector, such as greater tech integration in order to enable a smoother sale process, however the failure to gain any meaningful ground where market share is concerned tells you all you need to know about the future of the online estate agent.”

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