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Redfin laid off 85 employees on Thursday, according to a report from GeekWire.
The layoffs impacted support and sales managers within the company’s real estate brokerage and Concierge segment, which focuses on offering pre-listing home improvement services. A Redfin spokesperson said the layoffs were spurred by an increasing focus on Redfin Next, the company’s hybrid compensation plan that enables agents to keep full-scale benefits while earning competitive commission splits.
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“This morning Redfin had a targeted layoff of fewer than 100 people, primarily in our Concierge service and support and sales managers within the real estate brokerage,” a spokesperson told Inman. “No agents are being laid off. In fact, some of the impacted employees are being offered jobs as agents.”
As for Concierge operations, agents will take the lead.
“As we hire more Redfin Next agents and our current agents become more entrepreneurial and self-sufficient, Redfin needs less support and managerial staff,” they added. “Additionally, Redfin is decentralizing operations for our Concierge service. Redfin will continue to offer Concierge service for sellers but in a more decentralized form with local agents taking the lead.”
The layoffs come on the heels of a stock market rally for the Seattle-based brokerage.
Redfin’s stocks have risen 30 percent over the past month due to improving existing sales and mortgage rates, according to a MarketWatch analysis on Monday. The Aug. 17 change in cooperative compensation rules also contributed, as Redfin CEO Glenn Kelman predicted more consumers will embrace the brokerage’s pricing structure in the face of a more complicated commission landscape.
“We’ve tried in the past to recruit buyers by offering them a better deal, and mostly they’ve been confused by that because they haven’t been the ones paying their agent. (Now) we think we can use price as a weapon to gain share,” Kelman said during the company’s second-quarter earnings call.
The layoffs haven’t seemed to impact Redfin stock (NASDAQ: RDFN), which rose 3.10 percent to $9.32 per share by market closing. The company’s stock is still rising in after-hours trading, rising 0.75 percent to $9.39 per share.
