Warren Buffett’s conglomerate, Berkshire Hathaway, is in advanced talks to sell its real-estate brokerage business, HomeServices of America, amid a slowdown in the industry. Compass is reportedly considering a deal to acquire HomeServices. The news sparked concerns that Buffett has lost faith in the struggling industry, which faces challenges including low sales, limited inventory, and high prices.
Buffett’s investment history suggests he may be right to reevaluate his involvement. In the 1970s, he invested in newspapers and eventually sold them due to declining profits from shrinking advertising revenue and the shift to digital platforms. Similarly, Berkshire attributed HomeServices’ recent loss of $113 million to ongoing real estate industry litigation.
The decline of the US housing market is also contributing to the slowdown. High mortgage rates, elevated prices, and limited new listings are deterring potential buyers. Pending home sales dropped 4.6% in January, the lowest level since 2001. A sale of HomeServices could be a sign that Buffett has lost confidence in the business’s ability to thrive.
Source: https://www.cnbc.com/2025/03/16/buffetts-berkshire-may-sell-its-real-estate-business-what-it-means.html