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Buyers, sellers more cautious as rates, economy fluctuate

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CEO Kelly says home listings benefit from wider exposure

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Kelly reports to Buffett heir apparent Greg Abel

By Jonathan Stempel

OMAHA, Nebraska, May 1 (Reuters) - The new chief

executive of Berkshire Hathaway's ( BRK/A ) HomeServices of

America said worries about the impact of tariffs on mortgage

rates are weighing on home buyers and sellers, but were unlikely

to significantly dent sales of existing homes.

"When mortgage rates are fluctuating because the underlying

economy is fluctuating, it causes buyers and sellers to stay on

the fence," Chris Kelly, who took over the largest U.S.

residential real estate brokerage on April 15, said in a recent

interview.

Higher borrowing costs contributed to a

greater-than-expected 5.9% drop in March U.S. sales of existing

homes, to a seasonally adjusted 4.02 million unit annual rate,

with more weakness likely as tariffs fan fears of a recession.

"The high degree of volatility we've seen in the last

couple of months is giving buyers and sellers a little bit of

pause," Kelly said. "But there are still 4 million people who

are going to make a move this year."

HomeServices is a unit of Berkshire Hathaway Energy, which

is part of Warren Buffett's conglomerate, and owns or franchises

more than 2,200 brokerage offices with over 82,000 agents.

It lost money in 2024, largely from its $250 million

settlement of antitrust litigation accusing the National

Association of Realtors and brokerages of inflating commissions.

HomeServices was the last defendant to settle the landmark

case, though Berkshire Hathaway Energy faces related claims.

The brokerage commission settlement ended the practice of

having sellers pay commissions, typically 5% to 6%, to their

agents, who would split them with buyers' agents.

Splits would be communicated over private databases known as

multiple listing services (MLS), which only agents would see.

Sellers claimed this was secretive and inflated closing costs.

The NAR's Clear Cooperation Policy requires agents to list

properties on their MLS within one business day of marketing the

properties to the public.

Supporters say it adds transparency and provides equal

access to listings, while critics say it restricts sellers'

ability to choose marketing strategies.

"That's where the current battlefront is: what happens if

more properties are listed as exclusives, or marketed with more

limited exposure," Kelly said. "From our perspective, the vast

majority of properties benefit from the widest exposure

possible, which means putting it in the MLS."

He added that "We always want the consumer to have a high

degree of clarity on the fee and commission structure."

HomeServices has curbed its once aggressive appetite to buy

brokerages to fuel growth, and Kelly said it will likely

emphasize "tuck-ins" of brokerages that might struggle to

compete on their own.

But he also said HomeServices has diverse revenue streams

from mortgages, title and insurance, citing its stake in

nationwide underwriter Title Resources Group, which can cushion

the blow when one segment falters.

Kelly, 49, joined HomeServices' network in 2007 when he

left private law practice to become general counsel at Kansas-

and Missouri-based ReeceNichols.

He later moved to the parent company. Kelly reports to

Berkshire Vice Chairman Greg Abel, who is expected to succeed

Buffett as chief executive.