Citing supply issues, property disruptor Homie cuts its workforce by 28%

(Getty)

Homie, the real estate industry disruptor selling properties in Utah, Arizona, Colorado, Idaho and Nevada, laid off 119 employees this week – 28% of its staff – saying it was struggling in a market with no supply.

“Record stocks absolutely played a part in that,” Homie co-founder and CEO Johnny Hanna told Deseret News. “2021 was already an incredibly competitive year and we started this year with even fewer homes than at the same time last year. And it’s even more competitive.

Hanna told the publication that the huge growth in homeowners’ net worth amid skyrocketing home values ​​also played a role in the reductions, as new wealth in homes lessens sellers’ worries about the amount they pay in traditional estate agent contracts, which can reach 6% of the sale price of the house.

This would play a significant role in impacting Homie’s bottom line, given that its business model is based on driving sellers to a service that promises lower flat fees on home sales.

Founded in 2016, Homie charges sellers just $1,500, betting that its low rate and combination of computer software and professional agents and attorneys make buying and selling a home a more enjoyable experience. efficient and easily scalable.

The company then launched three offshoots – Homie Loans, Homie Title and Homie Insurance – with the aim of creating a one-stop-shop for all real estate sales needs.

Since 2018, the company has raised over $33 million in venture capital to help it grow.

To help compete in a market that has become awash with cash offers for homes, Hanna said his company is now looking to help buyers make bank-backed cash offers – which he says is practically necessary due to the competition that has existed for just about every home that comes on the market.

[Deseret News] — Vince DiMiceli

Comments are closed.