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Warren Buffett Says He’d Buy a Couple Hundred Thousand Homes

By Katherine Tarbox, Senior Editor, REALTOR® Magazine

Warren Buffett, CEO of Berkshire Hathaway, said yesterday on CNBC’s “Squawk Box” that buying single-family homes is such a great investment right now, if it were practical, he’d buy a couple hundred thousand of them. Given how low rates are for a 30-year fixed-rate mortgages (3.95 percent, according to the Freddie Mac Mortgage Index), Buffett told CNBC’s Becky Quick that homes, held over the long term, provide a better investment than stocks. If you factor in that prices in some areas are at a 10-year low and inventory levels are high, the conditions are  ideal for buying.

While the “Omaha Oracle” has been right about a lot of investments, his opinion on housing hasn’t always been on the mark. At last year’s annual Berkshire Hathaway meeting, he said 2011 was going to be the year that housing prices were going to rebound. In a letter to his shareholders sent last weekend, he apologized for being “dead wrong.” He explained his belief that housing is a sound investment at least in part the inventory of new homes isn’t growing at a rate that will satisfy future demand. People living with their in-laws to save money, he quipped, will find that attractive for only so long.

You have to give Buffett credit for putting his money where his mouth is. Home Services of America Inc., a Berkshire Hathaway Affiliate, is one of the largest independent residential real estate and settlement servicing companies in the U.S. While Buffett wouldn’t comment completely on Berkshire Hathaway’s stake with each of the banks, the fund actively invests in them. He says if he could own only one bank stock right now, it would be Wells Fargo.

Comments
  1. Linda Salas

    This is really why, I believe the money manipulators created the bubble and burst it. Every time this is done, they lower the value of stocks, bonds and real property to an all time low and then buy it up with the earnings they stole from us po folk. Eventually they (the wealthy) and the banks will be the only landowners and we like the indentured servants of old, will be begging even more than we are now for the crumbs we get dealt. Thanks Warren for your generous offer.

  2. Sam Direct

    Homeowners should focus on telling congress whats important even with Buffet trying to buy 1,000 homes. Lets send 1,000,000 keys to congress and let them know that the American Dream is home ownership… https://www.entitledirect.com/register/facebook/key_cause_landing_page.jsp

  3. Warren, Can I be your broker?

  4. Myla

    tell him to buy my house then give it back to me! I’m a high school science teacher at an inner city school….I deserve it! ;-) (but I’ll settle for keeping my job and paying more mortgage until then…)

  5. Hello Warren, we’ve great a wonderful inventory of well priced homes in Owatonna, MN – I’d be glad to help you purchase a few.

  6. Lisa

    I agree, but the lenders need to allow us to do it. My husband and I recently did buy a single family house to rent out — it was our 5th mortgage among other rental properties. Now our local lender isn’t doing “non-owner occupied” mortgages any more despite having 800+ credit scores and no other debt outside of the mortgages. There are several more houses we’d want to buy and help out others displaced in the housing crisis by offering a rental HOUSE vs. an apartment, which are far and few between in our market. We’re frustrated that we can’t get additional mortgages on reasonable terms to make it happen. You would think that banks would want to lend to absorb the excess inventory, but loan restrictions and high down payment requirements make it tough. Buffet – will you do the loan for us, and we’ll buy up some of the inventory?
    In full disclosure, I’m a Realtor in my market and also realize the bargains to be had out there and have exhausted local lenders that can work around Fannie & Freddie restrictions.

  7. bob

    Warren: Shut-up and write the Government a big check.

  8. Hello Warren, we are handy with home renovations! We are Realtor and Contractor to assist you in purchasing homes in SW Florida to hold and rent or to resell. Check out this home just completed http://www.SamDinger.com

    We are buying homes and the courthouse, call / email today!

    Marzia Rivera, Realtor
    World Class Realty Partners
    SWFL Property Management
    239-540-4884

  9. If you are trying to sell a home, it is important that you market for home in all sorts of avenues. If you only advertise through a for sale sign, you will find it very difficult to sell your home. Make sure you advertise on the internet, in newspapers and through other creative avenues.

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    I like all of the points you made.

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