Warren Buffett’s Sage Advice – Buy Homes!

Investment tycoon and perennial prognosticator, Warren Buffet, delivered a two part message this past week. First is that he was dead wrong about the housing market’s recovery which he predicted last year would have already rebounded. The second is that he still believes housing is an excellent investment by generating rental income. While the so-called Oracle of Omaha has been wrong many times throughout the years, his typically long-term approach has more often than not proven to be correct.

There are certainly doubters aplenty out there today regarding the housing market, but one thing that Buffett continually strives to be is a contrarian. It’s this attitude of buying when others are selling or scared to act which in large part leads to his many successes. His company’s enormous wealth makes his investment successes more lucrative than the average investor of course.

This housing advice is likely a path many would be wise to follow as well, given a few key qualifications. Low interest rates are tough to pass up and often are worthwhile taking advantage of, but no housing investor should strap themselves to payments that are difficult to afford. Another cautionary warning with rental housing is that it comes with costs and headaches not apparent at first glance. Most of the headaches are removed when hiring a management company to oversee activities, but this comes at a price and still doesn’t preclude spending additional money to repair homes after normal wear and tear or renter’s neglect. Given the right scenario though, owning rental properties can be exceptionally lucrative and a great source of cash flow.

Stephen Woodall
REALTOR, GRI @ Long Realty Company
Stephen has made real estate his full-time career and passion since 2008, primarily specializing in the Foothills & the Northwest Tucson areas of Oro Valley and Marana. He is a multi-million dollar producer, representing both sellers & buyers. Stephen has tremendous experience in new home sales, listing & selling primary residences, listing & selling vacant land, listing & selling luxury homes, investment properties, rentals, and real estate development parcels.

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