UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-QSB

[X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934 For the quarterly period ended August 31, 2001

[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange Act;
For the transition period from _________ to __________

Commission File Number #000-1024048

HOMELIFE, INC.

(Exact name of small business issuer as specified in its charter)

NEVADA 33-0680443
------------------------------- ---------------------------------
(State or other jurisdiction of (I.R.S. Employer incorporation or
organization) Identification No.)

9475 Heil Avenue Suite D, Fountain Valley, CA 92708
--------------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code:
(714) 418-1414

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

Yes [X] No [ ]

The issuer had 5,488,586 shares outstanding as of August 31, 2001

Transitional Small Business Disclosure Format (check one):

Yes [ ] No [X]

HOMELIFE, INC.

INDEX
PAGE NO.
--------

PART I - FINANCIAL INFORMATION 1.

Item 1. Financial Statements 1.

Consolidated Unaudited Balance Sheet as of August 31, 2001 1.

Comparative Unaudited Consolidated Statements of Operations 3.
for the three months ended August 31, 2001 and 2000

Comparative Unaudited Consolidated Statements of Cash Flows 4.
for the three months ended August 31, 2001and 2000

Notes to Unaudited Consolidated Financial Statements 5.

Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation. 12.

PART II - OTHER INFORMATION 14.

Item 1. Legal Proceedings. 14.

Item 2. Changes in Securities and Use of Proceeds. 14.

Item 3. Defaults Upon Senior Securities. 14.

Item 4. Submission of Matters to a Vote of Security Holders. 14.

Item 5. Other Information. 15.

Item 6. Exhibits and Reports of Form 8-K. 15.
(a) Exhibits
(b) Reports on Form 8-K

PART I - FINANCIAL INFORMATION

HOMELIFE, INC.
CONSOLIDATED BALANCE SHEET
AS OF AUGUST 31, 2001
(UNAUDITED)

ASSETS
Current Assets
Cash $ 85,375
Marketable securities, at fair value 1,237
Accounts receivable 147,690
Notes receivable 146,351
Prepaid expenses and deposits 51,727
------------
432,380

Accounts Receivable - Long Term 25,800

Property and Equipment 310,788

Goodwill 356,475

Other Assets 284,745

Cash Held in Trust 212,221
------------

$ 1,622,409
============

HOMELIFE, INC.
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS OF AUGUST 31, 2001
(UNAUDITED)

LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities

Bank indebtedness $ 48,526
Accounts payable 373,135
Reserve for warranty 52,479
Dividends payable 4,770
Deferred revenue 207,064
------------
685,974

Deferred Revenue 138,042

Trust Liability 212,221

Minority Interest 32,827
------------
1,069,064

Stockholders' Equity

Capital Stock 1,030,230

Additional Paid in Capital 3,198,537

Accumulated Other Comprehensive Gain/(Loss) 4,885

Accumulated Deficit (3,680,307)
------------

553,345
------------

$ 1,622,409
============

HOMELIFE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED AUGUST 31, 2001AND 2000
(UNAUDITED)
2001 2000
------------ ------------
REVENUE

Royalty and franchise fees $ 195,177 $ 168,574
Warranty fees 76,282 84,372
Mortgage financing fees 10,607 23,046
Real estate brokerage 411,776 565,457
Other income 65,869 56,112
-----------------------------
759,711 897,561

DIRECT COSTS 470,669 597,124
-----------------------------

289,042 300,437
-----------------------------
EXPENSES

Salaries and fringe benefits 119,637 141,648
General and administrative 117,605 125,112
Occupancy 37,012 46,455
Financial 5,018 3,465
Amortization 36,743 8,643
-----------------------------

316,015 325,323
-----------------------------

INCOME/(LOSS) BEFORE GAIN ON DISPOSAL OF
SUBSIDIARY ASSETS (26,973) (24,886)

Gain on Disposal of Subsidiary Assets 52,130 --
-----------------------------

INCOME/(LOSS) BEFORE MINORITY INTEREST 25,157 (24,886)

Minority interest 1,568 188
-----------------------------

NET INCOME/(LOSS) 26,725 (24,698)

Preferred dividends -- (630)
-----------------------------

NET INCOME/(LOSS) APPLICABLE TO COMMON
SHARES 26,725 (25,328)
=============================

BASIC AND FULLY DILUTED INCOME/
(LOSS) PER COMMON SHARE $ 0.00 $ (0.01)
=============================

WEIGHTED-AVERAGE NUMBER OF 5,486,531 4,877,004
COMMON SHARES

HOMELIFE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED AUGUST 31, 2001 AND 2000
(UNAUDITED)

2001 2000
------------ ------------
$ $
CASH FLOWS FROM OPERATION ACTIVITIES

Net income/(loss) 26,725 (24,698)
Adjustments to reconcile net income/(loss) to net cash provided
by operating activities
Depreciation and amortization 36,743 8,643
Minority interest (1,568) (188)
Loss on trading securities 4,013 --
Gain on disposal of subsidiary assets (52,130) --
Stock based compensation 3,000 --
Reserve for warranties 7,576 1,639
Changes in assets and liabilities
(Increase) decrease in accounts and other receivable (38,593) 36,849
(Increase) decrease in notes receivable (845) (801)
(Increase) decrease in prepaid expenses 5,861 (11,034)
Increase (decrease) in accounts payable (27,403) (45,136)
Increase (decrease) in notes payable -- 70,568
Increase (decrease) in deferred revenue (15,705) --
-----------------------------

Net cash provided by/(used in) operating activities (52,326) 35,842
-----------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment -- (57,627)
Proceeds from disposition of subsidiary assets 64,500 --
-----------------------------

Net cash provide by/(used in) investing activities 64,500 (57,627)
-----------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Cash provided by (repayment of) bank indebtedness (1,704) --
-----------------------------

Net cash provided by/(used in) financing activities (1,704) --
-----------------------------

Effect of foreign currency exchange rates 1,024 --

NET INCREASE (DECREASE) IN CASH 11,494 (21,785)
Cash, beginning of period 73,881 248,064
-----------------------------

CASH, END OF PERIOD $ 85,375 $ 226,279
=============================

HOMELIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED FOR THE THREE MONTHS ENDED AUGUST 31, 2001

NOTE 1. BASIS OF CONSOLIDATED FINANCIAL STATEMENTS PRESENTATION

In the opinion of the Company's management, the accompanying condensed
consolidated financial statements include all adjustments, consisting only of
normal recurring adjustments, necessary for a fair presentation of the financial
position at August 31, 2001 and results of operations for the three months ended
August 31, 2001 and 2000.

These financial statements consolidate, using the purchase method, the accounts
of the Company and its subsidiaries listed below:

a) Wholly-Owned Subsidiaries - active
----------------------------------

HomeLife Realty Services, Inc., MaxAmerica Financial Services, Inc.,
Builders Realty (Calgary) Ltd. ,

Wholly-Owned Subsidiaries - inactive
------------------------------------

FamilyLife Realty Services, Inc., Red Carpet Broker Network, Inc.,
National Sellers Network, Inc., Aspen Benson & May LLC., HomeLife
California Realty, Inc. and HomeLife Properties, Inc.

b) Majority-owned subsidiaries

The Keim Group Ltd., and MaxAmerica Home Warranty Company - 93.33% and 82.72%
respectively.

On consolidation, all material intercompany accounts have been eliminated.
Consolidation commenced with the effective dates of acquisition of the
operations of the subsidiary companies and these financial statements include
the financial results of the subsidiaries for the period ended August 31, 2001
and August 31, 2000.

The assets acquired were recorded as trademarks and will be amortized over 10
years on a straight-line basis.

On February 27, 1998, the Company acquired all issued shares of Builders Realty
(Calgary) Ltd., a Canadian real estate broker, for $316,080 in cash and stock.

The goodwill will be amortized over 40 years on a straight-line line basis.

On September 15, 1998, the Company purchased all the issued shares of an
inactive holding company, Aspen Benson and May Investment Bankers LLC., for
Common stock in the amount of $77,500 to be issued in January 2000. At the time
of purchase, Aspen Benson and May Investment Bankers LLC. had negligible assets
and revenue.

On January 20, 1999, Builders Realty (Calgary) Ltd. purchased the real estate
brokerage business including licensing agreements and trademarks of HomeLife
Higher Standards operating in Calgary, Alberta, Canada, for $42,061 cash in
fourteen monthly installments of $2,714 and a final payment of $4,065.

During the period ended May 31, 1998, the company acquired, by cash of $5,000 in
total, all issued shares of several newly incorporated companies. These new
companies include: MaxAmerica Financial Services, Inc., which will be
originating real estate loans; HomeLife California Realty, Inc., which will be a
full service real estate operation; HomeLife Properties, Inc., which will be a
real estate holding company; Red Carpet Broker Network, Inc., and National
Sellers Network, Inc., which will be licensing real estate brokerages.

On July 8, 2001, the company entered into an agreement to sell the assets and
business operated by Homelife Builders Realty (Calgary) Ltd., a wholly-owned
subsidiary, for $64,500. This transaction was effective on August 31, 2001. The
gain on this disposition is included in the financial statements.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Principal Activities

HomeLife, Inc. together with its subsidiaries is a leading provider of services
to the real estate and mortgage loan industries. The Company engages in the
following activities:

The Company franchises full service real estate brokerage offices and provides
operational and administrative services to its franchisees under the names,
HomeLife Realty Services, National Real Estate Service, Red Carpet Real Estate
Services, Red Carpet Keim, Network Real Estate and International Estates.

The Company is a mortgage financing services provider through its subsidiary,
MaxAmerica Financial Services, Inc.

The Company owns and operates a full service retail real estate brokerage
through its subsidiary, Builders Realty (Calgary) Ltd.

The Company is a provider of home warranty coverage through its subsidiary,
MaxAmerica Home Warranty Company.

(b) Significant Group Concentrations of Credit Risk

The Company's accounts receivable and notes receivable are primarily from
franchisees in the real estate brokerage industry.

Cash and cash equivalents include cash on hand, amounts due to banks and any
other highly liquid investments purchased with a maturity of three months or
less. The carrying amount approximates fair value because of the short maturity
of those instruments.

(d) Marketable Securities

Marketable securities represent trading securities which have been reflected at
their fair market value at the year-end.

(e) Advertising Costs

Advertising costs represent prepaid preprinted advertising materials which have
been amortized over three years. For the period ended August 31, 2001, there are
no unamortized advertising costs.

(f) Other Financial Instruments

The carrying amount of the Company's other financial instruments approximates
fair value because of the short maturity of these instruments or the current
nature of interest rates borne by these instruments.

(g) Long-term Financial Instruments

The fair value of each of the Company's long-term financial assets and debt
instruments is based on the amount of future cash flows associated with each
instrument discounted using an estimate of what the Company's current borrowing
rate for similar instruments of comparable maturity would be.

(h) Amortization of Property and Equipment

Amortization of property and equipment is provided using the straight-line
method as follows:

Furniture and fixtures 7 years
Computer equipment and software 7 years
Leasehold improvements 7 years
Automobile 4 years

(i) Goodwill

Goodwill is the excess of cost over the value of tangible assets acquired. It is
amortized on the straight-line basis over 40 years.

(j) Amortization of Other Assets

Amortization of other assets is on a straight-line basis over their estimated
useful lives as follows: Trademarks and franchise rights 10 years

(k) Impairment

The Company's policy is to record an impairment loss against the balance of a
long-lived asset in the period when it is determined that the carrying amount of
the asset may not be recoverable. This determination is based on an evaluation
of such factors as the occurrence of a significant event, a significant change
in the environment in which the business assets operate or if the expected
future non-discounted cash flows of the business was determined to be less than
the carrying value of the assets. If impairment is deemed to exist, the assets
will be written down to fair value. Management also evaluates events and
circumstances to determine whether revised estimates of useful lives are
warranted. As of August 31, 2001, management expects its long-lived assets to be
fully recoverable.

(l) Revenue Recognition

Income from the sale of franchises is recognized over a 5-year period. Master
franchise agreement fees are recognized over 10 years. Royalty income stemming
from the gross commissions on the sales of real estate by the franchise offices
is recognized at the date of receipt; this is due to the complexity of
attempting to forecast the actual closing date of the properties. Warranty
income is recognized over the term of the contract which is usually 12 months;
anticipated obligations under these warranties have been recorded as reserve for
warranty and are based on past experience. Real estate brokerage income is
recognized at the close of escrow. Loan fees are recognized as income when the
loan is closed and funded at the close of escrow. Revenue received or
receivable, from the sale of franchises, master franchises and warranties, which
are not recognized as income, are recorded on the balance sheet as deferred
revenue.

(m) Income taxes

The Company accounts for income tax under the provisions of Statement of
Financial Accounting Standards No. 109, which requires recognition of deferred
tax assets and liabilities for the expected future tax consequences of events
that have been included in the financial statements or tax returns. Deferred
income taxes are provided using the liability method. Under the liability
method, deferred income taxes are recognized for all significant temporary
differences between the tax and financial statement bases of assets and
liabilities. In addition, the Company is required to record all deferred tax
assets, including future tax benefits of capital losses carried forward, and to
record a "valuation allowance" for any deferred tax assets where it is more
likely than not that the asset will not be realized.

(n) Stock-Based Compensation

In December 1995, SFAS No. 123, Accounting for Stock-Based compensation, was
issued. It introduced the use of a fair value-based method of accounting for
stock-based compensation. It encourages, but does not require, companies to
recognize compensation expense for stock-based compensation to employees based
on the new fair value accounting rules. Companies that choose not to adopt the
new rules will continue to apply the existing accounting rules contained in
Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to
Employees. However, SFAS No. 123 requires companies that choose not to adopt the
new fair value accounting rules to disclose pro forma net income and earnings
per share under the new method. SFAS No. 123 is effective for financial
statements for fiscal years beginning

after December 15, 1995. The Company has adopted the disclosure provisions of
SFAS No. 123 for both employee stock based compensation. The Company's stock
option plan prior to 1997 which vested immediately and therefore there were no
expense amounts to be reflected in the current financial statements. The Company
has used the fair value approach for stock option plan granted to non-employees
according to EITF 96-18.

(o) Foreign Currency Translation

Builders Realty (Calgary) Ltd., a wholly-owned subsidiary, maintains its books
and records in Canadiandollars.Balance sheet accounts are translated using
closing exchange rates in effect at the balance sheet date and income and
expenses accounts are translated using an average exchange rate prevailing
during each reporting period. No representation is made that the Canadian dollar
amounts could have been, or could be, converted into United States dollars at
the rates on the respective dates or at any other certain rates. Adjustments
resulting from the translation are included in accumulated other comprehensive
income in stockholders' equity.

(p) Net Income (Loss) and Fully Diluted Net Income (Loss) Per Weighted Average
Common Stock

Net income (loss) per Common stock is computed by dividing net income (loss) for
the year by the weighted average number of Common stock outstanding during the
year.

Fully diluted net income (loss) per Common stock is computed by dividing net
income (loss) for the year by the weighted average number of Common stock
outstanding during the year, assuming, except where the result would be
anti-dilutive, that all convertible Preferred shares were converted, the
contingent Common stock were issued, the warrant was exercised and the stock
options granted were exercised. The shares to be issued have not been included
in the calculation as the number of shares to be issued is not determinable.

(q) Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principals in the United States of America requires management to
make estimates and assumptions that affect certain reported amounts of assets
and liabilities and disclosures of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

NOTE 3. CASH HELD IN TRUST AND TRUST LIABILITY

Cash held in trust are deposits received in connection with the opening of
escrow accounts for the sale of real estate. The deposits are recorded as trust
liabilities and are refunded when the real estate is sold or the escrow is
closed according to the terms of the escrow agreement.

NOTE 4. BANK INDEBTEDNESS

At August 31, 2001, the company had three available lines of credit under bank
loan agreements. Two of the lines amounted to $80,000 combined and were
unsecured operating credit lines bearing interest at the rate of 16% per annum.
These lines were held by the corporate office in California. The third line of
credit amounted to $32,500 (Canadian $50,000) and was held by the Calgary
office. This operating credit facility bears interest at the bank's prime
lending rate plus 2% per annum with interest payable monthly. All three credit
facilities are guaranteed by a major shareholder of the company.

NOTE 5. CAPITAL STOCK

(a) Authorized

100,000 Class A Preferred shares of no par value, 6% non cumulative dividend,
voting, convertible to Common shares at the option of the shareholder at a price
equal to the face value of the Class A shares. Each Class A Preferred share
carries 1,000 votes as compared with 1 vote for each Common share

2,000 Class AA Preferred shares of $500 par value, 8% cumulative dividend,
non-voting, redeemable at face value by the Company. Convertible after 12 months
from the date of issuance, at the option of the shareholder, to Common shares at
a price equal to 125% of the face value of the Class AA shares as compared with
the market price of the Common stock.

100,000,000 Common shares of $0.001 par value

(b) Issued

10,000 Class A Preferred shares
50 Class AA Preferred shares
5,488,586 Common shares

On June 30, 2001, an officer and director of the Company received 30,000 common
shares at the fair market value in exchange for services rendered.

On January 16, 1997, the Company granted a warrant to S & S Acquisition Corp. as
part of the consideration for the acquisition of its assets. The warrant
entitles S & S Acquisition Corp. to acquire, from January 31, 1998 to January
31, 2002, up to 200,000 Common shares of the Company at $6 per share. The number
of Common shares and the price per share are adjusted proportionately with the
increase in the number of Common shares issued by the Company. As the market
value of the Common share of the Company was significantly lower than $6 per
share, no value was assigned to the warrant.

(d) Stock options

On September 18, 1998, the Board of Directors of the Company adopted a stock
option plan (the "plan") for its directors, employees, and consultants. An
authorized number of shares of Common stock of the Company, which may be granted
under the plan, is one million shares. The terms of the options were to be
determined by the president of the company, subject to the approval by the
shareholders.

(e) Stock option plan

On September 18, 1998 the board of directors of the company adopted a stock
option plan (the "plan") for its directors, employees, and consultants. An
authorized number of shares of common stock of the company which may be granted
under the plan is one million shares. The terms of the options were to be
determined by the president of the company, subject to the approval by the
shareholders.

As of August 31, 2001, options to various employees of the company to acquire
130,000 Common stock had been granted under the stock option plan with the
following terms:

100,000 Common shares at $3 per share, granted in February, 1998, vested and
exercisable for 5 years
30,000 Common shares at $5 per share, granted in September, 1998, vested and
exercisable for 5 years

(f) Earnings per share

The fully diluted earnings per share does not include the issuance of shares
which would be anti-dilutive arising from the following:

i. Conversion of 10,000 Class A Preferred shares to Common shares
ii. Conversion of 50 Class AA Preferred shares to Common shares
iii. Exercise of warrant which entitles holder to acquire 200,000 Common
shares at $6 per share
iv. Exercise of stock options to acquire 130,000 issuance of Common shares
v. Common stock which may be required

NOTE 6. PROMISSORY NOTE RECEIVABLE

On October 8, 1999, a promissory note receivable in the amount of $250,000 was
exchanged for 100,000 shares of Pioneer Growth Corp. ("Pioneer"). The value of
these Pioneer shares have been guaranteed by the issuer of the promissory note
for $250,000 (the "guaranty"). Should the value of the Pioneer shares be less
than $250,000 on the due date of the promissory note, October 8, 2000, the
issuer of the note has the option to make up the difference in cash, or make up
the difference with HomeLife Inc.'s common stock by providing one share of
HomeLife, Inc's common stock for each dollar that is deficient.

On November 1, 2000, the company agreed to accept full ownership rights to a
company, Consolidated International Telecom, Inc. ("Consolidated"), in exchange
for the 100,000 shares of Pioneer, the guaranty and to extend the repayment date
of the promissory note from October 8, 2000 to December 31, 2001. Should the
value of the shares of Consolidated be less than $250,000 as at December 31,
2001, the promissory note would then be immediately due and payable and the
issuer of the note would be subject to the guaranty as detailed above. The
amount is included in subscriptions receivable and the shares of Consolidated
and Pioneer are not reflected, as resolution of these items will only occur on
December 31, 2001.

NOTE 7. SEGMENTED INFORMATION

Segmented information has been provided for the company on the basis of
different geographic areas and different services. The revenue for Canada is
substantially all derived from real estate brokerage.

a) Revenue by Geographic Area
2001 2000
$ $
United States of America 347,935 332,104
Canada 411,776 565,457
----------------------------
759,711 897,561
============================

b) Net Income (Loss) by Geographic Area

United States of America 42,710 (21,888)
Canada (15,985) (2,810)
----------------------------
26,725 (24,698)
============================

c) Identifiable Assets by Geographic Area
2001 2000
$ $
United States of America 1,446,326 1,956,399
Canada 176,083 282,529
----------------------------
1,622,409 2,238,928
============================

d) Amortization by Geographic Area

United States of America 36,743 6,471
Canada - 2,172
----------------------------
36,743 8,643
============================

d) Revenue by industry
Real Estate Franchise 195,177 168,574
Real Estate Brokerage 411,776 565,457
Mortgage Financing 10,607 23,046
Home Warranty 76,282 84,372
Other 65,869 56,112
----------------------------
Total 759,711 897,561
============================

e) Net income (loss) by industry

Real Estate Franchise 44,101 (27,723)
Real Estate Brokerage (15,985) (2,810)
Mortgage Financing 2,393 319
Home Warranty (6,390) 9,754
Other 2,606 (4,238)
----------------------------
Total 26,725 (24,698)
============================

f) Identifiable assets by industry

Real Estate Franchise 1,237,710 1,724,903
Real Estate Brokerage 176,083 282,529
Mortgage Financing 77,115 16,302
Home Warranty 116,437 157,921
Other 15,064 57,273
----------------------------
Total 1,622,409 2,238,928
============================

2001 2000
$ $
g) Amortization by industry

Real Estate Franchise 36,365 6,435
Real Estate Brokerage -- 2,172
Mortgage Financing -- -
Home Warranty 378 36
----------------------------
Total 36,743 8,643
============================

NOTE 8. DISPOSAL OF SUBSIDIARY ASSETS

On August 31, 2001, the transaction was completed to sell the assets and
business operated by Homelife Builders Realty (Calgary) Ltd., a wholly-owned
subsidiary, for $64,500. Pursuant to this sale, the company received $38,700 in
cash and has booked a long term account receivable for $25,800 to be paid in
equal installments October 31, 2002, 2003, 2004 & 2005.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Overview

The Company has experienced growth primarily through its acquisitions of
and combinations with various other companies. This includes the acquisition in
August 1996 of the Keim Group of Companies and MaxAmerica Home Warranty Company
(Michigan) adding 60 real estate offices and a home warranty company in
Michigan. In 1997, the company purchased certain assets of S & S Acquisition
Corp. providing the company with Red Carpet Real Estate Services and National
Real Estate Services adding 58 real estate offices. The acquisition of the real
estate computer technology of House by Mouse and Virtual Assistant provided the
Company with the ability to enhance its Internet communication services to its
franchises. In July 1997, the Company acquired the licensing agreements,
trademarks and franchise offices of Network Real Estate, Inc. This acquisition
provided the Company with an additional 12 offices in Northern California and
access to the "high-end" luxury division of "International Estates". In February
1998, the Company acquired Builders Realty (Calgary) Ltd. providing access to
the Alberta, Canada market in both retail real estate and mortgage loans. On
September 15, 1998, the Company purchased the stock of the investment banking
firm of Aspen, Benson and May, LLC for Common stock.

From time to time, the Company has entered into strategic alliances with
various companies in order to explore the cross marketing of their services to
customers of the Company or its franchises. To date, these strategic alliances
have not included any funding agreements or other liabilities on the part of the
Company. Since the end of its last fiscal year, HomeLife has formed strategic
alliances with Home Value Check, LLC, and Allstate Funding. Home Value Check
provides Internet based appraisals for lenders and consumers of the Company's
services. Allstate Funding

provides loan processing and underwriting for MaxAmerica, the real estate
mortgage brokerage subsidiary of HomeLife.

The following is management's discussion and analysis of HomeLife's
financial condition and results of operations. Detailed information is contained
in the financial statements included with this document. This section contains
forward-looking statements that involve risks and uncertainties, such as
statements of the Company's plans, objectives, expectations and intentions. The
cautionary statements made in this document should be read as being applicable
to all related forward-looking statements wherever they appear in this document.

THREE MONTHS ENDED AUGUST 31, 2001 (UNAUDITED) COMPARED TO THE THREE MONTHS
--------------------------------------------------------------------------------
ENDED AUGUST 31, 2000 (UNAUDITED).
----------------------------------

REVENUES. The Company generated gross sales of $759,711 for the quarter
ended August 31, 2001 compared to gross sales of $897,561 for the quarter ended
August 31, 2000. Revenue by business segment is shown below:

August 31, 2001 August 31, 2000
Amount % Amount %
------ - ------ -
Real estate brokerage 411,776 54 565,457 63
Royalty & franchise fees 195,177 26 168,574 19
Mortgage financing 10,607 1 23,046 3
Home warranty sales 76,282 10 84,372 9
Other 65,869 6 56,112 6
-------- --- -------- -
TOTAL 759,711 100 897,561 100
======== === ======== ===

Real estate brokerage commissions decreased from $565,457 for the quarter ended
August 31, 2000 to $411,776 for the quarter ended August 31, 2001. The decrease
in brokerage revenue results from a decrease in the number of brokers and a
decrease in the number of escrows per broker from the prior year.

Royalty fees & franchise fees combined increased $26,603 from $168,574 for the
three months ended August 31, 2000 to $195,177 for the three months ended August
31, 2001. The increase relates to the revenue associated with the master
franchises sold during fiscal year 2001.

Mortgage financing fees were $10,607 for the quarter ended August 31, 2001
compared to $23,046 for the same period in the prior year. The decrease is a
result of timing the close of loans as well as the strong competition in this
area.

Home warranty sales were comparable for the two periods at between 9% & 10% of
overall sales.

DIRECT COSTS. Direct costs for the current quarter were $470,669 compared
to $597,124 for the same prior year quarter. This decrease corresponds to the
overall decrease in sales for the two quarters.

SALARIES AND FRINGE BENEFITS. Salaries and fringe benefits decreased from
$141,648 for the three months ended August 31, 2000 to $119,637 for the three
months ended August 31, 2001. This decrease of $22,011 was primarily the result
of two employees who left the company and were not replaced.

GENERAL AND ADMINISTRATIVE. General and administrative costs for the
quarter ended August 31, 2000 were $125,112 versus $117,605 for the quarter
ended August 31, 2001. This decrease of $7,507 is part of management's plan to
reduce costs. Part of the reduction in costs includes a decrease in the use of
outside consultants.

OCCUPANCY. The decrease of $9,443 in occupancy costs from first quarter
fiscal year 2002 compared to first quarter fiscal year 2001 results from the
Michigan and California corporate offices moving or reducing office space to
reduce costs.

FINANCIAL. Financial costs were slightly higher for the quarter ended
August 31, 2001 due to interest on the line of credit.

AMORTIZATION. Amortization of intangibles was $8,643 for the three months
ended August 31, 2000 compared to $36,743 for the three months ended August 31,
2001.

MINORITY INTEREST. The increase in net income due to minority interest was
$1,568 for the quarter ended August 31, 2001 and a reduction of net loss of $188
for the quarter ended August 31, 2000. This results from the Keim Group Ltd. and
MaxAmerica Home Warranty Company, combined, recording losses in the applicable
quarters.

LIQUIDITY AND CAPITAL RESOURCES. The Company has 3,750 shares of Voice Mobility
Inc. as a marketable security, and lines of credit with three banks in the
amounts of CDN$50,000 and $80,000. The capital requirements of the Company are
for operating expenses and to service and use of its lines of credit. The
Company has recorded a loss on its marketable security as the share price has
declined in the public market from the purchase share price. The Company has
recorded significant operating losses in the prior two years. These losses are
primarily due to amortization and depreciation of acquisitions made in prior
years, loss on investments made in prior years, and write down of marketing
materials purchased in prior years. The company does not have any derivative
instruments or hedging activities therefore, the company believes that SFAS No.
133 will have no material impact on the company's financial statements or notes
thereto.

The company has experienced recurring operating losses and has a working capital
deficiency of $253,594 as of August 31, 2001. Effective August 31,2001, the
company has disposed of Builders Realty (Calgary) Ltd., a wholly-owned
subsidiary which had suffered recurring losses. In addition, management has
initiated changes in operational procedures, reduced expenses and focused its
efforts on its core business. Management believes that, it has developed a plan
which, if successfully implemented, can improve the operating results and
financial condition of the company. The plan is in the early stages of working
as exemplified by the net income for the first quarter ended August 31, 2001.
Furthermore, the company continues its attempt to raise additional financings
through private and public offerings.

FOREIGN FRANCHISEES. Foreign franchisees consist of the sale of a master
franchise agreement to an individual in Germany. Payment for this agreement were
scheduled to be made in 12 quarterly payments beginning in October 1999. Only
partial payments have been received, however, and the company is now in
negotiations with the obligor to restructure this obligation. Continued default
of this agreement will deprive the Company of the anticipated payments, but is
anticipated to have no adverse consequences to the operations of the Company,
since it has no commitments of capital of other resources to its foreign
franchisees. During the current fiscal year, the company sold master franchise
agreements in Portugal and China.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The company is involved in a lawsuit with the sellers of Builders
Realty (Calgary) Ltd. to reduce the purchase price paid for Builders
Realty (Calgary) Ltd. The sellers of Builders Realty (Calgary) Ltd.
have filed a counter lawsuit for damages of $238,275 (Canadian
$356,699). In management's opinion, this matter will not have a
material affect on the financial position of the company.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULT UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a) Exhibits:

None.

(b) Reports on Form 8-K:

None.

SIGNATURES

In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.

HOMELIFE, INC.
(Registrant)

Dated October 15, 2001 /s/ Andrew Cimerman
--------------------------------
Andrew Cimerman,
Chief Executive Officer and Director