Divvy Stays Mum As Staff Report A New Spherical of Layoffs

At the least seven former workers posted on LinkedIn Thursday to say they’d been laid off from the rent-to-own firm.

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Hire-to-own firm Divvy Properties has undergone one other spherical of layoffs, eliminating a number of positions, in keeping with public LinkedIn posts.

Divvy has but to make a public announcement or reply to Inman’s a number of requests for remark, however no less than seven former workers posted on LinkedIn on Thursday that they’d been laid off from the corporate.

Amongst these affected had been a former vice chairman of communications, an operations mission coordinator, a software program engineer, a technical recruiter, an IT engineer and an acquisitions lead, in keeping with LinkedIn posts.

“I used to be laid off from Divvy Properties in the present day, alongside many different proficient and wonderful colleagues,” former head of communications Cristin Culver wrote on the social media web site. “It was a brief however candy stint at an organization with a mission and staff I’ve lengthy admired.”

Whereas it stays unclear what number of workers had been affected, this marks the third spherical of layoffs the rent-to-own firm has undergone over the previous 12 months. In February, the corporate instituted a spherical of layoffs that they equally didn’t publicly reveal any particulars about, with information of the layoff coming from affected workers’ LinkedIn posts.

In September of 2022, the agency slashed 12 p.c of its workers, or 40 individuals, as a response to growing rates of interest.

“Realistically, the macro surroundings is more likely to stay risky and difficult for the foreseeable future. Consequently, we wanted to regulate headcount to replicate the brand new actuality in the present day,” communications Vice President Kyle Zink stated on the time.

In line with an worker affected by the layoffs, who requested to talk on background, rising charges had been once more cited as the explanation for downsizing. The corporate had initially made strikes to preserve capital when charges first began to rise in 2022, however ad infinitum to the high-rate surroundings, it’s now not possible for them to develop, workers had been informed.

Divvy purchases properties on behalf of its prospects after which rents the properties again to them whereas the purchasers proceed to construct fairness on the properties. Initially, the renter contributes 1 p.c to 2 p.c of the house worth to the acquisition, then about 25 p.c of every month-to-month cost that follows goes towards saving up for a down cost.

The settlement between renters and Divvy is organized so {that a} renter can save as much as 10 p.c of the house’s negotiated buy worth over the course of a three-year lease, however may also purchase the house at any time. Or, if the renter decides in opposition to the house, they’ll stroll away and obtain money for his or her financial savings, minus a “relisting charge” amounting to 2 p.c of the house’s preliminary buy worth.

Divvy’s effectiveness at turning renters into householders has been questioned, nevertheless, as has the standard of its rental properties. A Fast Company investigation revealed in October of 2022 discovered that the corporate prices greater rents than conventional landlords in some markets, and has stepped up its evictions of tenants regardless of its acknowledged purpose of serving to renters change into householders.

A subsequent New York Times investigation discovered that Divvy prospects had a far greater month-to-month outlay in contrast with prospects of different rent-to-own companies, resulting in struggles for a lot of renters in an period of elevated inflation. It additionally discovered that many purchasers struggled with the corporate’s in-house restore service and infrequently skilled lengthy ready intervals for routine repairs.

 E-mail Ben Verde