By Sam Boughedda
Opendoor (NASDAQ:OPEN) said it has made the "difficult decision" to reduce its team by 550 people across all functions, representing approximately 18% of its workforce.
The move comes as mortgage rates in the U.S. have risen significantly, hitting housing demand. "The reality is, we're navigating one of the most challenging real estate markets in 40 years and need to adjust our business," Chief Executive Officer Eric Wu wrote in a blog post.
Other housing firms, such as Redfin (NASDAQ:RDFN) and Zillow Group (NASDAQ:ZG), have laid off workers recently.
"To manage through the turbulence in the market, we've worked quickly over the last two quarters to reduce our operating expenses," added Wu. The company revealed that prior to today, it scaled back its capacity by over 830 positions, primarily by reducing third-party resourcing and eliminating millions of fixed expenses.
OpenDoor is an online company that buys and sells residential real estate, also known as iBuying. A recent sharp shift in housing prices forced the business to sell homes for less than it paid.
The company will report earnings for its latest quarter after the close on Thursday.
OpenDoor shares are down over 1% Wednesday.