Mergers And Acquisitions Likely To Dominate Real Estate In 2025

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Commission lawsuits and battles involving the National Association of Realtors have dominated recent headlines. But quietly in the background, something else was also going on: Major acquisitions and mergers.

High-profile examples include Compass buying Latter & Blum in April and @properties Christie’s International Real Estate in December, as well as Howard Hanna merging with Home Experts Realty last month. These and similar stories raise several questions: Will similarly big acquisitions continue this year? What types of companies will do the acquiring, and what types will be gobbled up?

In other words, was 2024 a prelude or a postscript to the consolidation story?

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To find out, Intel contacted industry experts — for both on- and off-the-record talks — and surveyed brokerage leaders in our latest Inman Intel Index survey.

The takeaway from these efforts is that a variety of factors are converging to potentially make 2025 a banner year for mergers and acquisitions. Put another way, there’s a good chance that 2024 was in fact just a prelude.

But at the same time, not everyone is likely to be a victor in this story. Instead, big and powerful companies that have a track record of succeeding in lean times may be the ones making the most headlines for M&A deals this year.

Most brokerage leaders aren’t focused on M&A

In January, Intel asked brokerage leaders to rank mergers and acquisitions on a scale of one to five. One indicated that M&A was not on their radar, while five indicated that imminent discussions were taking place. The results suggested that mergers and acquisitions are not especially high on the priority list for many of the nearly 200 brokerage leader-respondents.

• Nearly 47 percent of survey respondents selected one, meaning M&A is not on their radar. Another 12 percent selected two, similarly indicating that M&A is a low priority.
• Only 8 percent of respondents selected five, with another 12 percent selecting four — responses indicating that M&A is a major priority.
• Results were similar when Intel asked leaders about M&A in 12 months. In that case, 36 percent of respondents selected one — which again in this question meant the topic is “not on the radar” — and another 16 percent selected two. Only 11 percent of respondents selected five.

Acquisitions flow to the big companies

None of this means, however, that mergers and acquisitions won’t be a big deal this year. In fact, everyone who spoke with Intel for this story predicted significant M&A news in the coming months.

“I think it’ll be a very active year,” Chris Heller, president of OJO/movoto.com, told Intel in a comment that captured a broader sentiment. “I think a lot of companies are looking to grow and I think we’ll see a lot of activity.”

The takeaway, then, is that M&A may not be evenly distributed; en masse, acquisitions may not be on every radar, but its a topic that’s very much on the radar of a few big players.

The experts offered several reasons that 2025 might be active for M&A.

• A slow market has put pressure on smaller companies for several years now.
  • “You’re going to see companies basically saying I don’t see a way out of this and I want to cash my chips in,” Russ Cofano, CEO of Collabra Technology, told Intel.
  • “As the industry goes through challenging times, you tend to see a lot of consolidation,” Heller said.
• Larger companies such as Compass have managed to grow despite a slow market.
  • Compass, for example, reported growth in both revenue and agent count in the first three quarters of 2024.
  • EXp’s agent count growth largely remained stalled in 2024, but the company did report revenue gains in the first three quarters of last year.
  • “The big companies probably feel like they’ve weathered the storm,” Heller said. “They’re not looking at 2025 as, ‘let’s just get to the other side.’ They’re looking at 2025 as, ‘now we have to grow.’”
  • “With the big players, this is part of their strategy, they are actively looking at how to grow their companies with acquisitions,” Cofano said. “As opposed to the smaller companies that might be more opportunistic in the way they approach an acquisition, through relationships at local levels.
• Cloud-based companies such as eXp, LPT, and Real are growing and have leaner operations than traditional brokerages. Some M&A may consequently take place as traditional operations look for access to those business models.
  • The Real Brokerage, for example, reported last fall that its agent count exploded by more than 2,000 between July and October.
  • “It’s nearly impossible for a traditional brick-and-mortar company to suddenly become cloud based,” Cofano said. “They almost need to kill their old model.”
• Private equity companies have been sitting on the sidelines for the last several years.
  • “A lot of the acquisitions are going to be from private equity,” Ben Kinney, co-founder of Place, which made five acquisitions last year. “They’re sitting on enormous buckets of cash that they haven’t been able to deploy. They’re looking for opportunities and my phone is ringing off the hook.”
  • Kinney also said that capital markets may give more money this year to “strong companies,” putting them in a “position to gobble up the weaker ones.”

Brokers are most interested in making acquisitions

Intel also asked brokerage leaders who do have M&A on their radars what types of deals they might consider. Most indicated they are more interested in gobbling up competitors than they are in being gobbled up themselves.

• A plurality of respondents, or 48 percent, said their brokerage acquiring a competitor in their market was something their leadership teams would consider this year.
• The second most popular response, at 38 percent, pointed to their firm making an acquisition to expand into a new market.
• Only a total of 23 percent indicated their leadership team would be open to selling, either with that team staying in place or with them leaving.

The strong survive

Ongoing market pressure means one type of acquisition that may become common this year will involve companies that haven’t yet figured out the new normal.

• “On the outside they may not look like they’re struggling, but they likely are,” Heller said of some acquisition targets. “Things aren’t improving at the rate they need them too.”
• “For any real estate brokerage or brand, the key measure of success is how many great real estate agents you attract and retain,” Marc King, former president of Keller Williams, told Intel. You grow or you go backward, there is no stasis. Thus, any company not willing to evolve, grow and increase its value to the local agent will likely be a target of acquisition.”

However, the splashiest deals may actually involve companies that are thriving.

• “In those scenarios the companies being acquired have to see a 1+1=3 scenario,” Cofano said. “They’re not companies that are necessarily financially struggling or feel like they don’t have a path forward. But they feel like with the acquisition, they and their agents can do financially better with new ownership and resources and scale and all those things that a larger organization can provide.”
• Kinney also pointed to cash flow positive companies — think regional brokerages or title firms — as possible acquisition targets. “These companies are sold to private equity firms, public companies, or other profitable private firms trading on a multiple of EBITDA.”

Trickle down economics

Though Intel survey questions focused on brokerage leaders, proptech came up repeatedly in Intel’s conversations for this story. And the idea is that for all the trouble the market has given brokerages, it has been at least as bad for many proptech firms who make money from real estate professionals — professionals who in these days may have much less cash. The result is that 2025 may be a period of winnowing for the proptech world as companies merge in an effort to survive, or to cut losses at the eleventh hour.

In other words, proptech may become ground zero for real estate M&A in 2025.

• “There’s a large number of startups that launched in the last five years that are in the stage where if they’re not profitable they’re going to be targets,” Heller opined. “If they aren’t successful in finding a home then they often times merge with other companies.”
• Kinney noted that in tech there may be companies that have “bad product fit and low revenue,” in which case “these companies are often fire sales, purchased for scraps by smaller companies looking to create new revenue streams or boost their own numbers.”
• Other companies may have good products, but struggle with revenue growth. “These companies are acquired through a combination of cash and stock, offering founders an opportunity to have a bigger win with the acquiring company,” Kinney also said. “They are typically bought by companies seeking to expand their customer base or product lines.”

Methodology notes: This month’s Inman Intel Index survey was conducted Jan. 21-Feb. 4, 2025, and received 652 responses. The entire Inman reader community was invited to participate, and a rotating, randomized selection of community members was prompted to participate by email. Users responded to a series of questions related to their self-identified corner of the real estate industry — including real estate agents, brokerage leaders, lenders and proptech entrepreneurs. Results reflect the opinions of the engaged Inman community, which may not always match those of the broader real estate industry. This survey is conducted monthly.

Email Jim Dalrymple II