Menu
Save, make, understand money

First-time Buyer

Purplebricks gets slap on the wrist by ad watchdog for ‘misleading’ figure

Paloma Kubiak
Written By:
Paloma Kubiak
Posted:
Updated:
15/09/2016

The Advertising Standards Authority (ASA) upheld two complaints made over a Purplebricks promotion suggesting customers could make average fee savings of £4,158 if they used the online estate agency.

The ASA queried the reliability of the calculations that led to the £4,158 figure – which included a 2011 Which? survey – and the flimsiness of the evidence substantiating the calculations in general.

However, the ASA threw out a further claim because it found Purplebricks customers are likely to make savings of thousands because high street estate agency fees cost ‘demonstrably more’.

An undisclosed complainant said the promotions in a TV ad and on its website were substantiated in small print from a five-year-old survey, adding that the claim consumers could save thousands was misleading and could not be verified as the firm had used dissimilar fee calculations as a comparison.

Purplebricks had also provided an email from a third party, a large, national firm, which stated that the average commission charged, from their experience, was between 1.1% and 1.8% at the time of writing their email in May 2016. From this, Purplebricks had calculated a national average commission of 1.5%.

Purplebricks is a national UK estate agency and lettings business operating a hybrid model driven by a combination of professional local property experts, technology and customer facing software.

The online agency charges consumers a fixed estate agency fee of £798 including VAT outside of Greater London, and £1,158 including VAT within Greater London.

ASA concluded that the ad must not appear again in its current form and Purplebricks must ensure it substantiated any future promotional claims and that identifiable competitors are ‘verifiable.’