Warren Buffet's Latest Real Estate Forecast

Warren Buffet, a well respected billionaire and head of Berkshire Hathaway investment group, has gotten a great deal of press from his Annual Letter To The Shareholders. From Bloomberg to USA Today to Reuters UK, his commentary has our attention.

He has basically said the problems in the US property market will be over within a year. Although prices will remain ‘far below bubble levels’ for the medium term, he predicted the house inventory declining should have the market rebounding by 2011. The quote that sums it all is “People thought it was good news a few years back when housing starts - the supply side of the picture - were running about two million annually. But household formations - the demand side - only amounted to about 1.2 million. After a few years of such imbalances, the country unsurprisingly ended up with far too many houses.”

Andrew Frye with Bloomberg cites that this has been "the worst housing decline since the Great Depression and has left one in five U.S. mortgage holders owing more than their houses are worth. Record foreclosures last year flooded a real estate market already glutted with unsold property, causing new construction to fall to the lowest in at least 50 years. The fall in homebuilding is the only fix unless the U.S. decides to 'blow up a lot of houses,' Buffett joked."

We are seeing inventory levels shrinking here is Tampa Bay and Buffet's prediction go right along with the advice we are giving our clients... the time to buy is now. Don't hesitate to call on us!