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Homie, a once fast-growing flat fee brokerage based in Utah, is reportedly losing its CEO and conducting a new round of layoffs amid a softening real estate market.
Johnny Hanna
Johnny Hanna, who cofounded Homie in 2015 and went on to serve as the company’s CEO, announced his departure during the Silicon Slopes technology conference near Salt Lake City on Friday, according to Axios.
Hanna reportedly said the market has “been thrown into turmoil” thanks to significantly higher mortgage rates and explained that in addition to his departure, other workers would also be leaving the company.
In a statement to Inman Tuesday, Homie confirmed that Hanna had stepped down as CEO but is becoming chairman of the board. The statement also noted that Mike Peregrina, previously a cofounder and president of the company, had been elevated to CEO. The statement further quantified the number of layoffs.
“As the real estate market continues to shift, Homie was forced to evaluate the current business structure and let go of 40 team members last week,” the statement added.
The latest round of departures comes about seven-and-a-half months after Homie laid off more than a quarter of its workforce. At the time of those layoffs, the company pointed to an ongoing inventory shortage that “created a challenging real estate market for home buyers,” among other things.
It was unclear how many workers Homie had before the most recent round of layoffs. However, after the layoffs earlier this year, the company employed just under 300 people. Assuming the staff was still roughly that same size as of this month, the latest layoffs would represent about 13 percent of the company.
After its founding, Homie quickly became among the most prominent of a new class of flat-fee companies. The firm charges homeowners just $1,500 to list and sell their homes.
Homie is based about 30 minutes south of Salt Lake City, Utah, in a tech-centric area known as the Silicon Slopes. Its cheeky billboards referencing pop culture and criticizing traditional agent commissions have become a fixture in the region. Over the years, Homie has also expanded into Arizona, Nevada, Colorado and Idaho.
The company has raked in a total of $35.1 million in venture capital throughout its existence, most recently raising $23 million in a Series B round in February 2020.
The bullish housing market of recent years has been good to companies like Homie, but that bullishness ended in 2022 thanks to mortgage rates that went from below 2 percent to above 6 percent. A recent study reveals that rates in 2022 have been more chaotic than at any point since the late 1980s.
The rising rates have slowed price growth and weakened buyers’ ability to afford homes.
Homie was in a particularly difficult spot during this process thanks to its concentration in western states. Cities, such as Salt Lake and Denver saw prices skyrocket over the past two years but have since been classified as among the most “overvalued” markets in the U.S., along with a number of other western cities, such as Las Vegas and Phoenix. Such markets also just happened to be Homie’s home turf.
Still, Homie is not alone when it comes to layoffs. This year has seen thousands of workers leave real estate companies as the market has grown increasingly challenging. The layoffs began in the mortgage sector with companies, such as Better, Mr. Cooper and Rocket Companies Inc. all shedding employees. However, over the last several months, brokerages and technology firms have also shed workers.
In the wake of the most recent layoffs, a number of Homie workers took to LinkedIn in recent days to talk about their experiences. Among them, Jasmin Godfrey said on the social network that she was laid off but her experience at the company was “incredible.”
“I am so grateful to have worked with so many amazing people in this company!” she added.
Courtney Hansen said on LinkedIn that she too was among those leaving the company. Hansen wrote that she was sad about leaving, but she appreciated having worked with “amazing” mentors and that her “heart is full of gratitude for the opportunities Homie has provided me.”
Update: This post was updated after publication with additional commentary from former Homie employees, background on the company’s staff size and a statement Homie provided to Inman.
