Redfin and Compass lay off a combined 900+ employees as mortgage interest rates continue to climb

The housing market has taken a huge hit this year as mortgage interest rates have surged.

The latest casualties in the proptech world are Redfin and Compass, which both announced layoffs today.

The company is laying off a lot of employees after May demand came in below expectations.

The company is cutting around 10% of its staff. He said that due to the signals of slowing economic growth they have taken a number of measures to safeguard their business and reduce costs.

There are two companies that help people find and buy homes.

Mortgage interest rates went up to nearly 6 percent this week, much higher than the rates seen in 2021. The idea of buying a home is not as appealing as it has been in the past. Many potential home buyers are pausing their plans due to overheated markets.

Glenn Kelman wrote that his company would host an all-hands meeting to address the move and that managers would be calling affected employees.

He apologized to the people who put their faith in the company. We don't have enough work for our agents and support staff, and less sales leave us with less money for headquarters projects.

The company is offering laid-off colleagues 10 weeks of base salary, with an additional week of pay for every year of service beyond one year, capped at 15 weeks of pay. The company is footing the bill for three months of healthcare for employees who have lost their jobs.

You should be able to find a job by the end of summer. It is necessary for us to.

Even though the company raised hundreds of millions of dollars, the executive acknowledged the irony of conducting a layoff.

But mortgage rates increased faster than at any point in history. We could be facing years, not months, of fewer home sales, and Redfin still plans to thrive,” he wrote. “If falling from $97 per share to $8 doesn’t put a company through heck, I don’t know what does…We owe it to everyone who has invested your time or treasure in this company to become profitable, and then very profitable.

The stock price was down from a high of $17.70. The stock was down to $8.16 from a high of $65.41. The market cap of the company is $874 million, while the value is almost $2 billion.

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