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The Real Deal Los Angeles

The Agency’s Umansky derides Purplebricks agents as “plumbers”

Criticism came in a panel exchange with Purplebricks US CEO Eric Eckardt
January 30, 2019 10:00AM

Mauricio Umansky and Eric Eckardt (Credit: LinkedIn)

Mauricio Umansky says Purplebricks’ agents are “plumbers” who can’t offer what traditional agents can.

The Agency co-founder leveled the criticism in an exchange with Eric Eckardt, Purplebricks’ U.S. CEO, at a panel discussion in New York on Tuesday.

Umansky was responding to Eckardt’s prediction that agents across the residential industry would see a “compression,” in commissions as they compete with brokerages like his, which has until recently worked under a flat fee model and says its online-based technology makes it easier for clients.

“If you want to hire a plumber for the most important transaction of your life, go for it,” Umansky said, according to Inman, which hosted the discussion.

Umansky said flat-fee and discount brokerages could never provide the services that full-service firms like the Agency provide. He said he had employees call Purplebricks to feel out the service and wasn’t impressed with the results.

“You get what you pay for,” he said. “I can tell you that inevitably the experience was absolutely horrendous.”

Eckardt said that his company’s data shows people are satisfied with their experience on the platform.

Purplebricks is based in London and expanded to the U.S. in 2017. Last week it switched up its model in the U.S. to be more in line with traditional brokerages. It ditched the flat-fee for a sliding fee based on zip code. The firm will also charge the fee after the sale instead of upfront as it does in the United Kingdom.

Neither Purplebricks nor Umansky are without other controversies. Purplebricks has taken heat for its advertising as well. An analysis by Jeffries found that it sold about half of homes listed on its platform, not the three-quarters it claimed.

Last summer Umansky’s own insurance provider sued him for allegedly misleading a client so he could flip a home in Malibu for $70 million. The case is ongoing. [Inman] — Dennis Lynch