Posted on 10/31/2012 10:36:56 AM PDT by blam
Warren Buffett Just Made A Huge Bet On The US Housing Market
Matthew Boesler
Oct. 31, 2012, 11:13 AM
Perhaps the most bullish indicator for U.S. housing is Warren Buffett.
The legendary investor has been buying up real-estate brokerages around the country as he bets on a housing turnaround. Now, he is partnering with Brookfield Asset Management, a Canadian real-estate investor, to more than double the size of his brokerage business.
Bloomberg Businessweek's Noah Buhayar has the details:
Berkshire’s HomeServices of America Inc. unit will be the majority owner of the venture to manage a U.S. residential real-estate affiliate network, according to a statement on the new company’s website. The firms plan to offer a new franchise brand, Berkshire Hathaway Home Services, starting next year. Brookfield’s network has operated under the Prudential Real Estate and Real Living Real Estate brands.
Berkshire’s managers have been positioning the firm to benefit as the U.S. home market recovers from its worst slump in seven decades. The Omaha, Nebraska-based company has bought a brickmaker, won the loan portfolio of bankrupt mortgage lender Residential Capital LLC at auction and built its HomeServices unit by agreeing to acquire real-estate brokerages in states including Oregon and Connecticut.
The press release says the brokerages that will make up the new company did a combined $72 billion in sales in 2011. That's more than twice the $32 billion in sales that Berkshire did in 2011 without the new brokerages.
More from the release:
The combined networks of more than 53,000 Prudential Real Estate and Real Living Real Estate agents generated in excess of $72 billion in residential real estate sales volume in 2011, and operate across more than 1,700 U.S. locations.
(snip)
(Excerpt) Read more at businessinsider.com ...
Then he’d better be betting on a Romney victory or he’ll take it in the shorts.
IMHO, I think this is kind of a no brainer. If Mittens wins next tuesday, (and I suspect Warren Buffees knows it) the housing market will most likely skyrocket over the next several years after being depressed for so long.
GARY SHILLING: A Housing Recovery? You've Got To Be Kidding Me (Another 20% price decline)
Yeah, I just wondering if the direction of the polling momentum is what he is betting with.
LOL, nahh, he'll just SHORT sale that TAKE!
Why wouldn’t Buffett invest in the item that the federal government owns and is managed by Geithner? Geithener runs all his decisions through Buffett, the ultimate insider.
is he betting on a massive government bailout?
This is a good bet since the Feds have embarked on selling gov backed mortgages in foreclosure to big politically connected investement groups.
http://www.cnbc.com/id/45925851/Government_Set_to_Sell_Foreclosures_in_Bulk
___ lots more articles going back over 2 years.
Google: government + foreclousres + sales + bulk
He’s a smart guy for but, it has to be a long term buy.
There are still 4.5 million homes in the shadow market and they still need to be sold.
Inventory is artificially tight because those homes can’t be released, at this time, or the price per square foot goes down.
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