What compass would acquire in a BHHS deal
At the moment the industry will wait for that declaration of intent signed by both parties to confirm the rumor. In the meantime, industry experts speculate about the potential impact and implications. Housingwire did not receive a response from BHHS or Compass for comment.
A combined compass and BHHS is said to have achieved $ 318 billion in sales volume in 2023, according to RealTrends data, almost double that of its nearest rival, Real estate everywhere. The top 10,000 agents at a combined company alone would, according to the parties of $ 360 billion in sales volume and nearly 400,000 deal, according to Ingenius facts.
Does home services lose its appetite for real estate?
In May 2024, just a few weeks after he announced, it reached a national settlement agreement in the committee’s lawsuits, Berkshire Hathaway HomeServices (BHHS) announced Lay -Offs, including the majority of his franchise sale team, the event and marketing team and various senior executives. They also announced that they would not have any conferences that year. And according to various sources, they started to add clauses in their franchise agreements that both parties could terminate the agreement with a six -month notification. In retrospect, all the actions that can be interpreted could be dissolved with the real estate sector, the parent company, home services or America.
According to Keith Robinson, co-CEO of NexThomeIn a recent Replace article“Buffet is a fundamental investor. When one of his companies no longer meets his investment criteria, he sells. But BHHS does not seem to have outgrown his ‘buy box’. Perhaps the decentralized, high trust character of the sale of real estate is not a company that he wants to stay in. “He also stated that” Buffett could use his balance in preparation for an economic delay. “
“There have been rumors in recent years that the parent company, home services, has not been too enthusiastic about real estate,” says Clayton.
That could be, but according to Murray, in general talking about the M&A market: “It is quite clear that we are at the bottom of the fall in the sale of homes. Moreover, the fears with regard to the lawsuit and the settlement in the rear viewing mirror with the most brokers with whom I speak are that their company is not influenced as deeply as they thought. So if you are going to make a large investment, this is when you buy. It is also a good time to sell because the conviction is that the next two, three or four years see a recovery. For sellers, if you do things well, you have a real plum where you have invested at the bottom. For buyers, the Earn Out is a good option to move forward than two years ago. “
Berkshire Hathaway HomeServices of America, which had around 820 brokerage offices and 270 franchises, was not profit in 2024, largely due to the settlement agreement to Sitzer/Burnett.
What’s in it for Kompas?
According to Murray, an acquisition of this size would still only give about 15% to 18% market share at national level. “I am liberal with those figures,” he said. But: “It would immediately strengthen the market share of Compass in New England, Philadelphia, Washington, DC, Atlanta, Zuid -Florida, Kansas City and other areas.”
“This acquisition is very logical for compass,” says Clayton. “It is logical and there are not many or no brands that can make this type of acquisition.” Moreover, Clayton adds: “Compass would get very mature leadership and respected brokers in a newer brand with newer technology.”
Of course, an acquisition of this size does not come without risks. “Retention would be the greatest risk,” says Murray. After all, it is the greatest risk with every acquisition. Will the agents stay? Will the brokers stay?
Despite the dazzling rumors, BHHS has firmly denied the takeover conversations with Compass. Whether this is a shift in future consolidation trends or just a case of wrong information, one thing is clear, Murray says: “The industry is ripe for consolidation.”
