Purple Bricks Exits The Real Estate Market After Less Than Two Years…Why
PURPLE BRICKS EXITS THE US REAL ESTATE MARKET AFTER LESS THAN 2 YEARS…WHY?… The real estate industry is abuzz with the withdrawal of a competitor who had promised to change the real estate paradigm. That’s right, totally change the way real estate is bought and sold, by providing services for both buyer and seller at tremendous savings. Sounds good, so what was the problem. In short, the old adage, “you get what you pay for.” Purple Brick agents were heavily restricted as to services they could offer, because their commission was next to nothing. Sellers don’t want to have to pay high commissions, understandable…but they also want complete and full service…not understandable. Even shoppers understand why they go to Target and why they go to Nordstroms, Denny’s or Mastros. What experience, as a consumer, do you want? When it comes to selling a home, most people want top dollar, a quick sale, and as smooth a transaction, translated, as little hassle as possible. What brings top dollar in today’s market? Two things will do this:
1) STAGING: Today’s buyers are sophisticated. They want to picture themselves in the home; in order to do that, it must be clutter free, have nice, new furniture, neutrally pleasing decor items and look as new as possible. Obviously sellers are not personally prepared to do all this, so the agent stages the property, often at their expense, or fronts the money for it and frequently the items, furniture and all come from their own collection that they own and store at their on ongoing expense. It’s part of doing business. Independent studies have shown that staging can add 20% to a homes perceived value!!
2) SOCIAL MEDIA CAMPAIGNS, ADS, BOOSTING, AND VIDEO, DRONE AND PROFESSIONAL PHOTOGRAPHY: Again, reminding you this is 2019. Photography must be exceptional, drone is a must. Media campaigns, besides the cost, must be savvy. Redirecting marketing is the next hot thing, and it isn’t free. Google optimization is also an in demand asset and Google is very smart as to what it allows to climb their pages. Video. Google likes Video.
What does all this have to do with Purple Bricks? Everything. Because they did none of this. How can you? It all costs money. It probably makes more sense to pay a full commission and get 20% more for your home, and clear an extra 15% equity, than to pay 1% and lose all that equity. Full service Realtors work very hard for their commission. Not only in the marketing of a home, but negotiating the contract, writing counter offers, and then facilitation of the escrow. If a homeowner had to retain an attorney to do all the contract work that a Realtor does as due course for a transaction, that would be a big bill indeed over the course of a 30 day escrow. Think billable hours. Realtors are a great deal.