Online US real estate firm Opendoor cuts 22% of workforce

Opendoor Technologies Inc on Tuesday said it was cutting roughly 560 jobs, or 22% of the workforce at the online U.S. real estate firm, citing a declining housing market.

The announcement followed a previous round of layoffs in November when the San Francisco company cut 550 jobs, or about 18% of its workforce at the time.

“We’re taking these actions now to better align our operational costs with the anticipated near-term market opportunity,” the company said in an email confirming the layoffs. Opendoor said new listings have fallen by around 30% from their peak in 2022 due in part to higher mortgage interest rates.

Opendoor reported a loss of $1.4 billion in 2022, more than double its $662 million loss in 2021, despite nearly doubling sales to $15.6 billion.

Opendoor uses artificial intelligence systems and other technologies to help it buy and price thousands of homes, aiming to flip them within a few months for a profit. It has been cutting prices for some homes that have lingered longer on its balance sheet, and the company said it is reducing its marketing spending.

At year-end, Opendoor had nearly 13,000 unsold homes, out of about 35,000 homes purchased in 2022. By comparison it bought just under 37,000 homes in 2021.

Shares of Opendoor, which as of Monday were up nearly 60% this year, fell more than 5% to $1.66 in mid-afternoon trading.

Most of the job cuts announced on Tuesday were in the company’s operations unit. (Reporting by Greg Bensinger; Editing by Paul Simao)

Source: GWFM Research & Study