The property game is no longer just door-to-door visits, open houses, and commission-hungry agents in shiny suits. Welcome to the world of digital disruption, where companies like Purplebricks have thrown the old rulebook out the window. But here’s the million-dollar question: how does purple bricks make money?
Launched in the UK in 2014, Purplebricks burst onto the real estate scene with a bold claim—to make buying and selling homes simpler, cheaper, and more transparent. Its model? A hybrid estate agency that mixes the convenience of online tools with the guidance of local property experts. But with lower upfront fees and no commission in many cases, it leaves many scratching their heads: How on earth is this business profitable?
Let’s break it all down and see what makes this purple-branded disruptor tick.
What Is Purplebricks?
Before we dive into the nitty-gritty of how Purplebricks rakes in the dough, it’s important to understand what the company actually does—and how it’s different from traditional estate agents.
The Hybrid Model Explained
Purplebricks is neither a traditional brick-and-mortar agency nor a fully digital platform. It’s a hybrid—offering:
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Local Property Experts (LPEs): Real estate pros who guide sellers and buyers.
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Online Listings: 24/7 dashboard access for sellers and buyers.
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Flat Fees: Instead of charging commission based on sale price, Purplebricks uses a fixed fee model.
So far, so good. But how does Purplebricks make money if it ditches juicy commissions?
The Core Revenue Stream: Fixed Upfront Fees
Let’s get straight to the heart of the matter. The primary way Purplebricks makes money is through fixed, upfront listing fees. Unlike traditional agents who wait for a home to sell to earn their cut, Purplebricks gets paid before the sale even happens.
What Does That Mean for Sellers?
Here’s what you need to know:
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Sellers pay a non-refundable fee to list their home.
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The amount varies depending on location but usually hovers around £999 to £1,499.
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Payment is due either upfront or after 10 months (with a deferred payment option through third-party financing).
This model ensures Purplebricks gets paid regardless of whether the home actually sells. It’s a risky proposition for homeowners but a predictable income stream for Purplebricks.
Additional Services That Boost Revenue
Purplebricks doesn’t stop at listing fees. Oh no—they’ve got plenty of add-ons and extras up their sleeves.
## 1. Mortgage Referral Fees
Partnering with mortgage brokers allows Purplebricks to earn referral commissions. When a buyer finds a home and clicks on Purplebricks’ mortgage advice links, the company earns a tidy sum for every successful lead.
## 2. Conveyancing Services
Conveyancing (a fancy word for legal stuff when buying/selling a home) is another goldmine. Purplebricks nudges clients toward its partnered conveyancing firms and earns a kickback from these recommendations.
## 3. EPC and Photography Packages
Need professional photos, floor plans, or an Energy Performance Certificate (EPC)? Purplebricks offers all of these services for a fee, either bundled or as optional upgrades.
## 4. “Pay Later” Financing
Purplebricks isn’t a lender itself, but by partnering with financing companies, it allows clients to defer payment. They get paid upfront by the lender, and the customer repays over time—with interest, of course. That interest benefits the lender, while Purplebricks gets its cut from the financing agreement.
Expanding the Purple Empire: International Markets
Purplebricks tried to go global—launching in Australia, Canada, and the U.S.. Though the U.S. and Australian arms eventually folded due to high operational costs and fierce competition, these ventures still taught the company valuable lessons.
In these markets, the revenue model stayed consistent:
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Flat fees for listings.
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Add-on services.
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Local real estate experts instead of full-time agents.
Even though they exited international markets, the core question—how does purple bricks make money—remains tied to how does purple bricks make money, upfront payments and partnerships.
The Benefits of Their Revenue Model
Let’s talk pros. There’s a reason Purplebricks’ business model attracted investors and clients alike.
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Predictable Revenue: Upfront payments create cash flow certainty.
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Low Overhead: No expensive high-street offices mean lower costs.
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High Scalability: A mostly digital platform means expansion doesn’t need huge capital outlays.
The Drawbacks: When the Model Doesn’t Work
But it’s not all sunshine and purple logos.
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Non-Refundable Fees Upset Sellers: If the home doesn’t sell, tough luck.
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Limited Hands-On Support: Critics argue the service lacks the human touch of traditional agents.
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Regulatory and Market Challenges: Housing markets fluctuate, and the fixed-fee model can falter when sales drop.
Competitors and Market Disruption
Purplebricks isn’t alone. Other online estate agents like Yopa, Strike, and Doorsteps have entered the fray, offering even cheaper—or free—listing options. So what keeps Purplebricks in the game?
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Brand Recognition: As a first mover in hybrid estate agencies, it has a head start.
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Advertising Muscle: National ad campaigns keep it top of mind.
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Tech Infrastructure: Years of refining the platform gives it a technological edge.
Real Case: A Seller’s Journey Through Purplebricks
Let’s paint a picture.
Sarah, a homeowner in Leeds, decides to sell her flat. She pays £1,199 upfront. Here’s how the money flows:
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Purplebricks gets £1,199—paid upfront.
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She chooses to use Purplebricks’ recommended solicitor. Purplebricks earns a referral fee (~£300).
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She gets professional photos for £100. That’s more revenue.
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The home sells. Purplebricks doesn’t earn more—but it already got paid.
Even if Sarah’s property doesn’t sell, Purplebricks walks away with her upfront payment. Multiply that by thousands of sellers? You’ve got a lucrative business.
FAQs About Purplebricks’ Business Model
Q1: Do they make money even if a house doesn’t sell?
Yes. Their main income comes from upfront listing fees, which are non-refundable.
Q2: Is Purplebricks cheaper than a traditional agent?
Usually, yes. Most traditional agents charge 1-3% of the sale price, which can be thousands more than Purplebricks’ flat fee.
Q3: Do they offer refunds if the house doesn’t sell?
Generally, no. Once you pay, that money’s gone.
Q4: How does Purplebricks make money on financing services?
They partner with financing firms, earning a commission when customers use the “pay later” option.
Conclusion: Is Purplebricks Building a Sustainable Future?
So, how does Purple Bricks make money in such a fiercely competitive market? Through smart monetization of services that traditional agents bundle into commissions:
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Upfront listing fees ensure revenue regardless of sales success.
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Add-ons like photography and legal referrals boost per-customer income.
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Financing partnerships make it easier for sellers to say yes—while Purplebricks gets paid instantly.
The model isn’t perfect. It’s faced backlash, market exits, and legal hurdles. But it’s also reshaped how people think about estate agents in the digital age.
Love it or loathe it, Purplebricks has made one thing crystal clear: the property game will never be the same again.
