EXp Realty announced Wednesday that it has reduced staff headcount by approximately 15 percent as the real estate market slows across the country due to various shelter-in-place orders. The moves are part of a general effort to lower expenses across the company.
“Staff departures aren’t easy, but we are doing this with the utmost respect for each and every person,” eXp Realty CEO Jason Gesing said in a statement. “We are grateful for the contributions of those who are leaving us.”
He added, “However, we are confident about our business model and these changes are the right thing to do to put eXp on a stronger path to grow when business — and life — returns to normal.”
The company has also taken a number of other proactive measures to reduce expenses, including the elimination of all business travel for staff; the reduction of contractors; a hold on non-essential, open positions and 50 percent salary reductions for Gesing and other executives, including founder Glenn Sanford.
Due to the unique nature of eXp Realty’s business model — the virtual cloud-based brokerage allows the company’s agents to operate without the costs associated with brick-and-mortar space — the company is still growing its agent count rapidly.
The number of agents and brokers on the company’s platform increased by nearly 60 percent year-over-year to 28,449 at the end of the first quarter. Transactions were up 73 percent year-over-year in the first quarter of 2020 and sales volume was up 93 percent year-over-year.
As a result of that increased headcount, April 2020 appears to be on track for year-over-year growth in both transaction volume and sales volume, but the company anticipates reduced transactions in future months due to those shelter-in-place orders.
“This global health crisis is unlike anything we’ve ever seen in our lifetimes, and our hearts go out to everyone impacted around the world, especially our agents, staff, partners and their families,” Gesing said. “From day one, we have run a lean and agile business so that eXp would be sustainable for the future.
“During the past year we grew headcount to stay ahead of our historic growth curve,” Gesing added. “While business has gone well through the first quarter of this year, we need to be prepared for challenges that may lie ahead for the entire real estate industry in the near future.”
EXp Realty isn’t alone in enacting layoffs as a result of the slowdown. Redfin announced Tuesday it was furloughing 41 percent of its agents and laying off 7 percent of staff, while Compass laid off 15 percent of its staff last month.