Redfin announced that 41 percent of its agents are leaving the company, with some leaving the company for good and most furloughed through the summer. The company also it is cancelling bonuses and temporarily cutting headquarter salary by 10 to 15 percent.
“We decided on this large-scale furlough because fewer people are buying and selling homes, but another factor was the federal government’s $600 weekly contribution to each person’s unemployment insurance,” CEO Glenn Kelman said. “Of the field folks leaving, we estimate about 75 percent live in states that will allow them to earn more from unemployment insurance than from Redfin.”
Kelman said employees who build the technology and programs behind the brokerage are staying on, with “a small number of departures” and a salary cut. Those agents who have not met with clients or completed training are being let go for good, he said.
The moves come amid a sharp slump for the housing market due to the coronavirus pandemic. The Mortgage Bankers Association announced Wednesday that mortgage applications for home purchases were down 33 percent last week from the same week in 2019. Another report issued this week predicted home prices would lag considerably after a strong start to the year.
See Redfin’s full statement here.