Why HomeServices is approaching acquisitions differently 

Streamlining agent support systems and preserving local culture is top of mind for HomeServices of America's new CEO. But Chris Kelly has also had to dispel rumors of an acquisition — which HomeServices has denied — in the weeks since he was elevated to the role after Gino Blefari stepped down in April.

In March, The Wall Street Journal reported that Compass was "in advanced talks" to acquire HomeServices. Blefari strongly denied the report shortly thereafter, and Kelly has continued to echo that response.

"We can definitively say that we are not for sale and we're very excited to be partnering with all the other great brokerages out there," Kelly said during an introduction to real estate executives at the T3 Leadership Summit last week in Frisco, Texas.

Acquisition rumors aside, Kelly said HomeServices is focusing on ways to improve how it handles its own acquired brands moving forward.

A shift in thinking about acquisitions

Kelly and his leadership team have concluded that the company's interaction with brands like Long & Foster, Ebby Halliday and others needs some tweaking. "The way that we were originally constructed as an enterprise was, we bought companies and we left them alone," Kelly said. "That worked well for a really, really long period of time."

But with margins changing, "there's more that we need to be doing together on the backside, preserving what are the great local cultures of our brands," he said.

Kelly contends that simplifying backend systems will allow brands to focus on their culture and uniqueness. But HomeServices needs to make sure agents are on board with those adjustments.

For example, HomeServices' variety of in-house services — including financing, title and insurance — are increasingly becoming digital-first experiences. Kelly said it's important for the company to show agents that it benefits them to stay in-house.

"It can't be enough just to say, 'It's there, please use us,'" Kelly said. "It has to be that it is easier for them to use that team than it is for them not to use that team. If I'm an agent, I don't have to worry about [whether] the loan docs are going to be ready on time because they're my team. That's the team I work with every day, so I don't have to worry about that."

This also factors into HomeServices' approach to acquiring other brokerages — something Kelly indicated the company is interested in, but with a different mindset from simply buying to enter a new market.

"For us now, it's really about, does it advance our model? Is the brokerage structured to support everything that we do under our model?" he explained. "If it does, then I think there'll be some strategic opportunities for growth."

Embracing new leadership

In addition to Blefari's role change at HomeServices, Kelly and his leadership team will also soon have to adjust to company life without Warren Buffett, who announced that he is retiring at the end of the year after six decades leading HomeServices parent company Berkshire Hathaway. Buffett has said he intends to hand the reins over to Greg Abel.

Kelly said he's thrilled with Buffett's replacement pick, noting that Abel has developed a deep understanding of the business through his time at the company — and believes Buffett's retirement is well-earned.

"Certainly with Warren Buffett the name recognition is really amazing, but I think after 94 years he's earned the right to go to McDonald's and get his [Coca-Cola] twice a day instead of once a day," Kelly said, jokingly referring to Buffett's soda habit.