We've been liveblogging Warren Buffett's appearance on CNBC, and in watching him it's clear which investment idea stands out above all of the others for him: Housing.
Specifically, he likes the idea of actually buying distressed houses with cheap leverage, and renting them out.
There are some caveats: He suggested that it's a good idea for "handy" investors, which implies that it's not the kind of passive investment you can just make and sit back and watch. You need some gumption to get out there, bid on homes, and do the leg work to rent out the property.
But if you can do it, the riches for you will be lucrative, says Buffett.
Just to underline this point some more, if you can get a loan, houses have never been better on an affordability/cost of mortgage basis.
Read more: http://www.businessinsider.com/warren-bu...z1nbbgEv4q
Here is Buffet's letter (pdf) http://www.berkshirehathaway.com/letters/2011ltr.pdf
Specifically, he likes the idea of actually buying distressed houses with cheap leverage, and renting them out.
There are some caveats: He suggested that it's a good idea for "handy" investors, which implies that it's not the kind of passive investment you can just make and sit back and watch. You need some gumption to get out there, bid on homes, and do the leg work to rent out the property.
But if you can do it, the riches for you will be lucrative, says Buffett.
Just to underline this point some more, if you can get a loan, houses have never been better on an affordability/cost of mortgage basis.
Read more: http://www.businessinsider.com/warren-bu...z1nbbgEv4q
Here is Buffet's letter (pdf) http://www.berkshirehathaway.com/letters/2011ltr.pdf