Housing market slump hits Redfin stock price as home sales bottom

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The sluggish housing market is weighing on Redfin's stock as home sales 'near rock bottom'

Shares fell as much as 24% following the earnings release on Thursday. Before midday in New York, the stock changed hands at about $11.21, down 22%.

The Seattle-based firm's revenue fell 21% from a year ago to $275.6 million, narrowly missing Wall Street expectations. Per-share losses narrowed to 25 cents, better than Wall Street's forecast for a loss of 32 cents a share.For the third quarter, Redfin sees revenue dropping about 13% to $265 million-$279 million and losses narrowing to $21 million-$30 million from $90 million.

The company has imposed several rounds of layoffs over the last year, cutting headcount on its sales staff by about a third, while also"We lost market share due to one-time setbacks from agent layoffs and the closure of RedfinNow, but we expect to return to quarter-over-quarter gains in the second half, as Redfin.com has been competing better for traffic," Kelman said, adding that Redfin's gross margins in its core real-estate-services improved by almost two percentage points.

Limited home inventory and elevated mortgage rates have kept house hunters sidelined and current homeowners reluctant to move, with many holding on to lower mortgage rates secured in prior years. Meanwhile, higher rates and rising home prices have worsened housing affordability. Redfin data shows that the typical monthly mortgage payment in the US was $2,605 in the four weeks that ended July 30 —

 

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