Warren Buffett is likely selling his real estate empire – the latest warning sign that the property market is in dire straits.
The real estate market has been on the skids in recent years. Brokerage companies have attempted to consolidate as home sales remain very low.
Compass, the largest real estate brokerage in the country, is in advanced talks to acquire Berkshire Hathaway’s HomeServices of America, the fourth-biggest player in the industry, according to The Wall Street Journal.
Buffett, the 94-year-old investment icon known as the ‘Oracle of Omaha,’ appears to be stepping back from the real estate game.
The financial details of the potential acquisition haven’t been disclosed, but sources say an agreement is close, barring any last-minute snags.
If the deal goes through, it would mark another major consolidation in a housing market already struggling with sluggish sales.
Would-be homebuyers have been sidelined for years due to sky-high mortgage rates, tight housing inventory, and record-breaking home prices.
In a recent earnings call, Compass’ CEO, Robert Reffkin, touted the brokerage’s size as a competitive edge.
Warren Buffett, the ‘Oracle of Omaha,’ is likely selling his real estate holdings
‘I believe 2025 will be the year that the gap between Compass and the industry widens,’ he said.
‘By leveraging our structural advantages and our affiliation with the Christie’s International Real Estate brand, we are positioning ourselves to accelerate our market share gains.’
Compass has been on a tear, scooping up smaller brokerage firms throughout the U.S.
In December, the company announced it was bringing Christie’s International Real Estate and @properties under its wings.
It also added Washington Fine Properties, a boutique luxury brokerage in the nation’s capital in February.
A shrinking pool of brokerages could further limit consumer choice in an industry already stacked against the average buyer.
Buffett bye-bye?
Buffett’s latest potential sell-off is yet another example of the billionaire investor hording cash and exiting the market.
Real Estate sales in the U.S. have remained sluggish as mortgage rates hit record highs
The iconic Berkshire Hathaway owner, now 94-years-old, has set prognosticators ablaze, with rumors flying that he is either retiring or anticipating a recession.
Buffett has sold off shares of companies like DaVita, Bank of America, CitiGroup, and Apple.
