Redfin Lays Off 4% Of Employees Amid The Ongoing Housing Downturn

Redfin, a real estate brokerage headquartered in Seattle, disclosed Thursday that the company has reduced its workforce by approximately 4%.

The company announced that 201 employees were let go in select groups, mainly those in real estate support roles. The reason for this unfortunate development was attributed to the housing market decline and the resulting economic instability, The Seattle Times Reported.

"While another layoff is painful, especially for those leaving the company, Redfin must continue to adapt to the current economic climate," the company said Thursday, as per Tech Crunch. "The people leaving Redfin have been wonderful colleagues; if they wanted to return, we'd welcome them back in a stronger housing market."

Redfin issued a statement indicating that impacted staff members will receive a severance package ranging from 10 to 15 weeks, based on their length of employment. Additionally, healthcare benefits will be provided for three months.

"The people leaving Redfin have been wonderful colleagues, and if they wanted to return, we'd welcome them back in a stronger housing market," a company spokesperson said in a statement, as per The Seattle Times.

Redfin disclosed its plans to discontinue its home-flipping program, RedfinNow, in November and eliminate approximately 862 jobs, equating to 13% of its workforce. This followed a previous reduction of 470 jobs in June.

"One problem is that the share gains we could attribute to iBuying have become less certain as we rolled it out more broadly, especially now that our offers are so low...And the second problem is that iBuying is a staggering amount of money and risk for a now-uncertain benefit. We've tied up hundreds of millions of dollars in houses that you yourself wouldn't want to own right now," Redfin's CEO Glenn Kelman said during November layoffs, as per Tech Crunch.

The company witnessed a 25% decrease in revenue in Q4, mainly due to hesitant buyers and sellers amid mortgage rate fluctuations and a sluggish market. Furthermore, the company reported a net loss of $61.9 million in this quarter, in contrast to $27 million during the same period one year prior, Geek Wire Reported.

Redfin had said in January the housing market was showing signs of recovery, with the report indicating a rise in the number of users requesting tours and engaging with agents to initiate the home-buying process. However, layoffs remained inevitable.

Real estate technology firms have suffered a severe blow as a result of a national housing slump caused by mortgage rates remaining significantly above 6% during the current and previous years.

Opendoor let go off 550 people in November, while Zillow laid off 300 people in October.