Real estate brokerages Compass Inc. and Redfin are laying off workers, as mortgage rates rise sharply and home sales drop.
In filings with the Securities and Exchange Commission, Compass will cut about 10% of its workforce and Redfin will cut about 6%, the companies said in regulatory filings on Tuesday.
For Compass, those cuts total for 450 employees contributing to an estimated $21.5 million to $23 million, before the taxes in the second quarter, the company said. On the other hand, Redfin expects to cut about 470 employees and estimates other costs will total $9.5 million to $10.5 million.
Rising rates and overheated home prices, which are now rising over 20%, have crushed affordability. Mortgage has fallen to its lowest level and the rates are rising from 3.29% to 6.28% now.