U.K. estate agent Purplebricks Group Plc is heading for its biggest share drop on record after a profit warning that cast further doubt about its unusual business model.
The Solihull, England-based company, which charges a flat fee whether a property is sold or not, fell as much as 38% after warning of a drop in business as a tax break for buyers came to an end.
“Supply in the market has fallen as we slowly adjust to a below normal level of activity following a period of successive lockdowns and the end of the stamp duty holiday,” Chief Executive Officer Vic Darvey said in a statement.
Analysts including Jefferies LLC had previously raised concerns that the model may hurt the company more during a downturn than traditional estate agents that charge sales-based commissions.
New instructions in the six months through Oct. 31 fell 23% compared with the same period last year, Purplebricks said Thursday.
READ MORE VIA BLOOMBERG
- Top Remuera real estate agent won’t get vaccinated, wear mask
- THE KING: Aussie residential real estate agent does $120m of sales in just two weeks
- Barfoot & Thompson Auckland house sales plummet by 41%
- AUSTRALIA: Is this the biggest property scam ever? | WATCH
- Abandoned land for sale
- Ed Sheeran reveals where he wants to live in NZ | WATCH
- Prime Minister Jacinda Ardern is now a property millionaire
- John Key says housing ‘boom run is over’
- HOUSING CRISIS: ‘Level and trajectory’ of house prices creating risks for recent buyers
- The great New Zealand ‘Property Boom’ is OVER!