The veteran millionaire is considered one of Wall Street’s sharpest investors and has earned the nickname of the Oracle of Omaha for his successes. In 1958 the investor bought a five-bedroom house because his family was growing and now he is being offered $1.44 million for it. They are 44.44 times more than what he paid. Although the purchase seems like a good investment, Buffett says that he would have earned more if he had rented it instead of buying it.
Millionaire for his long-term investments. One of the traits on which the 118,000 million dollars that he treasures in his fortune are based, is that of betting on long-term profitability for his investments, and his house is a good example of this. . In 1958, the Buffetts bought the family home for $31,400. Taking inflation into account, today it would be the equivalent of about $329,000.
If Warren Buffett put it up for sale today, the approximate value of his house would be 1.44 million, according to the valuation of a specialized portal.
The Buffett family home. Warren Buffett married his first wife and the mother of his children in 1952. In 1956, the family began to grow and they rented a house for $175 a month in Dundee, a quiet neighborhood in Omaha, the millionaire’s hometown. As published by the Wall Street Journal, the property has 306 square meters distributed in five bedrooms, four bathrooms and a large garden area that surrounds the house.
Although the millionaire has always lived in that house, it is not the only home he has had. In 1971 the Buffett family bought a summer house in Laguna Beach (California) for $150,000, which today is equivalent to $900,000. Warren told the Wall Street Journal that he did not buy it for investment purposes. He did it only because his wife Susan liked the area. In 2017 its sale was closed for just over 11 million dollars.
A life linked to that house. Buffett has a very special bond with his house. In a letter to investors he singled it out as his third best investment. Just behind his wedding bands. Despite being the sixth richest person in the world, Warren Buffett is known for his Spartan tastes and his unhealthy diet. He has lived in that house ever since and seems to like it very much. This house is fine, says Buffett. “I am warm in winter, cool in summer, it is comfortable for me and I have the office 5 minutes away,” he said in an interview on the BBC. “I couldn’t imagine having a better home.”
Inside Warren Buffett’s house
Supporter of property, but also of opportunity. The Omaha millionaire has been in favor of the option of owning a home instead of renting, and he reflected this in several interviews. However, he does not deny the evidence that, looking back and taking into account rental prices at the time, Buffett acknowledges that he would have made much more money if he had rented his house and invested the rest in stocks. .
The nonagenarian millionaire warns that buying a house can mean the ruin of many families, especially in a scenario of skyrocketing interest rates and with a very limited supply of land, which puts family economies to the limit. A change in credit conditions and a lack of bank control can leave those who invest in a home highly exposed to bankruptcy, just as it happened in the 2008 crisis.
The rental market is not much better. However, the situation of the rentals in the 60s and 70s are not, by far, the current ones. The shortage of housing in urban centers causes demand to grow and prices soar. The profitability of the rental market is changing the main trend in Spain, where 70% of the population owns their home, while 30% lives for rent. Now, on the other hand, the trend is imposing a turn towards the (BTR) model that predominates in the countries around us and is based on building housing with rent in mind.
