Former Purplebricks Australia sales boss Luke Pervan has won the backing of Andrew Gordon and a partnership with Financial Review’s Rich List Bruce Gordon’s WIN Television network for a new fixed fee real estate agency whose model mirrors the British’s group hybrid offering.
Mr Pervan’s new outfit, Betterway Real Estate, has recruited 16 agents and will launch this month with an advertising campaign running on the regional television network and targeted at home sellers in Newcastle, Wollongong, the Gold Coast and the Sunshine Coast.
Andrew Gordon, the son of media mogul Bruce Gordon, has signed on as a board director and investor alongside media sales veteran Peter Moore’s Moorex Investments.
“We’re launching regionally with the great backing from the WIN regional television network,” Mr Pervan told The Australian Financial Review.
“We’re focusing initially on regional markets because they are the ones that get left behind by national launches [of new real estate businesses].”
Mr Pervan, who was Purplebricks Australia national sales manager from its launch in September 2016 until November 2017, said he was “saddened” by its failure. However, he had focused on “what went right” at his former employer in coming up with a better way to sell real estate.
“What I learnt is that customers like knowing what they will pay. Fixed fee real estate provides customers with an open and honest offering,” he said.
After racking up huge successive losses, Purplebricks announced its Australian exit in May.
The group sold more than 6000 homes in less than three years in Australia, but many of its agents could not make a living from their meagre split of the fixed-fee payment.
The British group, whose momentum was halted by the housing market slowdown, allegations of a toxic workplace culture and a vendor-discounting scandal, admitted it had made “execution errors” when launching in Australia.
Betterway’s fixed fees will start at $8750 (Purplebricks charged $8800) with about 20 per cent payable upfront. The rest will be due on settlement.
Agents will be paid only on completion of a sale.
Like the Purplebricks offering, vendors will be able to track the progress of their campaign digitally (through an app).
Similarly, Betterway agents won’t have to prospect for leads. Mr Pervan said these would come through its media partnerships, including investments in regional television and the digital space.
“We’ve removed the burden of prospecting. We just want our agents to focus on the customer,” he said.
Mr Pervan, who previously was a licensed real estate agent at Little Real Estate and a sales manager at LJ Hooker, added: “There’s a huge market place for what we will offer.”