Redfin’s latest round of layoffs is impacting the real estate industry
Seattle real estate brokerage Redfin imposed a new round of layoffs on Thursday, a development first reported by GeekWire.
A Redfin spokesperson confirmed to the outlet that fewer than 100 employees were affected. The cuts affected the company’s concierge service – which helps homeowners improve the curb appeal of their home before it goes on the market – and support staff and sales managers. Some of the affected workers are offered jobs as agents.
“As we hire more Redfin Next agents and our current agents become more entrepreneurial and self-sufficient, Redfin will require less support and leadership staff,” the spokesperson told GeekWire. “In addition, Redfin is decentralizing operations for our concierge service.”
Amid the flurry of commission lawsuits across the country over the past year, brokers like Redfin have restructured their compensation plans to retain existing agents and attract new ones.
The Redfin Next plan, which first launched in October 2023, allows agents to earn commissions of up to 70% on self-generated leads and up to 40% on leads received through the Redfin website. These agents are W-2 employees who receive health insurance, 401(k) matches and other benefits. The brokerage has since expanded the plan to several new markets, including 25 additional markets this month.
This is at least the third round of significant job cuts for Redfin in recent years. In June 2022, 500 employees were laid off due to rising interest rates, and another 200 were laid off in April 2023.
The company has struggled financially, reporting a $27.9 million loss in the second quarter of 2024, up slightly from the $27.4 million loss in the second quarter of 2023. Revenue and gross profit rose year-over-year, but stagnant 2024 housing market conditions ensured CEO Glenn Kelman says that if mortgage rates don’t fall and home sales don’t rise, “Plan B is to drink our own urine or the blood of our competitors.”
