Two major real estate firms announced layoffs this week, both of which have a large presence in the Bay Area.
Compass reduced its staff by about 450 people across the country, though the company wouldn’t confirm to SFGATE how many were affected in the Bay Area. Those laid off were full-time Compass employees, not real estate agents.
“Due to the clear signals of slowing economic growth we’ve taken a number of measures to safeguard our business and reduce costs, including pausing expansion efforts and the difficult decision to reduce the size of our employee team by approximately 10%,” a Compass spokesperson told SFGATE. Compass is headquartered in New York City.
In its most recent housing report for the Bay Area, Compass reported that rising interest rates are affecting Bay Area home sales — overall sales are declining and the number of active listings and price reductions are increasing. Still, the report steeled against any drastic conclusions, writing: “As an analogy, if traffic is going 100 miles per hour and drops to 65, it feels a lot slower, but can not reasonably be described as slow.”
Redfin, a Seattle-based brokerage, cut around 6% of its employees, a company spokesperson told SFGATE. That’s approximately 470 employees, including some from Rentpath and Bay Equity, two of the company’s subsidiaries. Redfin CEO Glenn Kelman wrote in a statement, “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.”
As mortgage rates continue to climb, there are signs that the red hot housing market is finally slowing nationwide. Rates have risen from approximately 3% in early January to more than 6% currently.
