Purplebricks launches in the US, kicks off in LA

AIM-listed hybrid estate agent Purplebricks was set to formally launch its business in the US later on Friday.

The launch will kick off in Los Angeles before extending across California and other target key states thereafter. The company said this was in line with the region by region rollout successfully adopted for entry in the UK and Australia markets.

Purplebricks said California is the "natural launching point" for US expansion as it is the leading US state in terms of both number of annual real estate transactions and estimated commission income. Although California, at 12.6m households has less than half the UK equivalent, the level of commission income in California is more than double that of the UK.

The group added that its technology platform and customer offering has undergone a transformation to meet the intricacies of the US market, "while staying true to the core customer proposition of value for money and high quality customer service".

Purplebricks will charge sellers a flat fee of $3,200 to list their property, with sellers also responsible for paying a buyer fee on closing. It said a key attraction of the US market and a substantial opportunity is the potential to earn buyers commission immediately.

Chief executive officer Michael Bruce said: "Launching Purplebricks today in the US is the single biggest moment in the company's three-year history and a proud moment for me personally. It is testament to the quality and dedication of the team that we have achieved this ahead of schedule and expectations.

"We are excited about the opportunity, in this $70bn market, while mindful of the challenges. We have planned accordingly, adapting both our technology platform and customer proposition, while building out an infrastructure and local team, with decades of experience. As we rollout across California and beyond we will closely monitor progress and have the capability to further quickly and efficiently refine our model, if and where necessary."

At 0950 BST, the shares were up 2.9% to 401p.