Neil Woodford has bought a major stake in Purplebricks.com, a firm which aims to shake up the estate agency industry.
Purplebricks, which launched in April and offers a 24-hour service, levies a fixed fee of £599 for customers selling their homes. This significantly undercuts the average high street agency commission of 1.8%, resulting in an average charge of around £5,600.
Customers selling their homes through Purplebricks will pay a fixed fee of £599, undercutting the average High Street estate agency’s sales commission of 1.8%, which results in an average charge of more than £5,600, saving customers 84.5% in fees.
Meanwhile property owners looking to rent their home will pay a single fee of £199.
‘Purplebricks represents a highly disruptive business model in the world of estate agency,’ said Woodford (pictured).
‘With the funding that it now has at its disposal, I see a significant opportunity for the business to lead the market in changing the way we buy and sell houses in the UK.’
Purplebricks was founded by brothers Michael and Kenny Bruce.
While it is not officially rolling out until September it was aiming to list around 15,000 sales instructions by the end of July.
For financial year ending 31 July 2015 it is targeting 85,413 instructions and the following year 100,849, representing 10% of all sales.
Other investors attracted to the firm include former Capita chief executive Paul Pindar, who made a ‘significant’ investment in the firm a month before its launch.