Investing veteran Neil Woodford has highlighted the importance of Purplebricks to his Patient Capital Trust.
The online agent is in the top ten holdings of Woodford’s investment trust, making up 3.79% of the fund, and he describes it as “well placed to significantly disrupt the UK’s traditional estate agency business model”.
Woodford raised a record £800m when he launched the Patient Capital Trust in 2015, but its latest annual report shows its net asset value declined 4.2% in the year to December 2016.
He has emphasised the fund’s long-term investment approach, and described the part that Purplebricks plays.
Writing in the Patient Capital Trust’s annual report, Woodford, an early investor in Purplebricks, says it is “fast becoming a household name”.
He said: “It is a ‘hybrid’ property agent, combining a simple-to-use online platform with a team of flesh-and-blood agents.
“It operates 24/7 and is well placed to significantly disrupt the UK’s traditional estate agency business model – indeed it is already doing so.
“Its growth revenues increased by 159% for the six months to October 2016 after it sold £2.6bn worth of properties over that period, making it the third largest operator in the market.
“With the strategic and successful launch of its brand in Australia in September, Purplebricks’ disruptive and competitive business model is beginning to demonstrate its international viability and it has recently raised capital to expand into the US in 2017.”
There is no mention of how many properties the online agent has actually sold, but Woodford seems keen to hold on to the shares. His other investments have certainly done less well than Purplebricks.