Longtime Redfin CEO Glenn Kelman said in the latest company Q2 earnings call with analysts that if mortgage rates don't keep falling, Redfin's "Plan B is to drink our own urine or our competitors' blood, stay in the foxhole."
Redfin's revenues for the quarter ended June 30 beat analyst estimates, jumping 7% year-over-year (YoY) to $295.2 million. The stock price climbed over 12% yesterday to close at $7.55 per share. However, analysts focused on mortgage rates, which continued its decline to reach a 15-month low this week. Kelman highlighted that it is pretty confusing that homebuyers are not reacting to the relatively lower mortgage rates as pending home sales and mortgage applications fell YoY by 5.7% and 14%, respectively. Meanwhile, housing affordability remained at a 40-year low while inventory is 30% below pre-pandemic levels.
