Real Estate Forecast 2012 Warren Buffett Says Buy, Baby, Buy!

by Gary and Lisa Schoeffler on March 6, 2012

in Latest News

Warren Buffett’s real estate forecast for 2012 and beyond is extremely rosy, with the so-called Oracle of Omaha even recommending buying them over investing in a diversified group of leading companies.

In an interview with CNBC on Monday, Buffett said single-family homes, along with stocks, are cheap and attractive investments. By contrast, investments in Treasury bills, gold or simply keeping money in cash are not as attractive.

Buffett said if he had a way to buy “a couple hundred thousand single-family homes” and easily manage them, he would “load up on them” and “take mortgages out at very, very low rates.”…..

Moreover, as the economy recovers, both rent and housing prices should rise as well.

A perhaps even better argument that the real estate market is historically cheap, however, is that mortgage rates are at or near the historic low.

Mortgage rates are a huge driving factor of the ultimate cost of purchasing a home.

For example, the total interest expense of a $200,000, 30-year fixed-rate mortgage at a 4 percent mortgage rate, which is the current rate, is $144,000. At 10 percent, which was the prevalent rate in 1990, interest expense comes to $432,000.

Lisa Schoeffler, CRS, ASP
Prudential California Realty
A member of HomeServices of America, Inc.
a Berkshire Hathaway affiliate

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Post by Gary and Lisa Schoeffler

Gary and Lisa Schoeffler are Ventura Real Estate Professionals specializing in residential real estate. Their expertise in helping both buyers and sellers is widely recognized in Ventura County. How can they assist you today? Wondering what the market is like? Call them, they will be happy to talk with you about it. 805-320-4472

Gary and Lisa has written 372 articles.

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