CEO Glenn Kelman announced the layoffs Tuesday, telling employees, “With May demand 17% below expectations, we don’t have enough work for our agents and support staff, and fewer sales leaves us with less money for headquarters projects.”
Redfin employees who were laid-off will receive “10 weeks of base salary, with an additional week of pay for every 12 months of service beyond one year, capped at 15 weeks of pay,” according to Kelman’s announcement.
The cuts at the online listing site and real estate brokerage could affect more than 450 people. Redfin has about 5,800 employees, not including those who work for RentPath, which Redfin acquired last year.
According to Kelman, the company needs fewer software engineers to work on already-created tools. The company will also spend less on analytics and user research. Those recruited in 2020 and 2021 when the company was turning away customers will be “hardest hit today,” Kelman announced.
Kelman said mortgage rates increased faster than “at any point in history,” adding, “We could be facing years, not months, of fewer home sales, and Redfin still plans to thrive.”
“If falling from $97 per share to $8 doesn’t put a company through heck, I don’t know what does,” Kelman said, referring to the company’s high in 2021 during the COVID-10 pandemic.