Buffett Weighs in with Costa Mesa Real Estate Investing Ideas
A couple of Fridays ago, yahoo!finance presented a column certain to attract readers who have ever considered whether Costa Mesa real estate investing would be worth pursuing. The article promised to reveal investor Warren Buffet’s candid opinion on the matter. The billionaire Wall Street legend seemed to be bearish on Costa Mesa real estate investing. And if the headline was accurate, this GOAT was bearish on your prospects, too:
“Why Warren Buffett Doesn’t Buy Real Estate
And Most Other Investors Shouldn’t Either”
This seems to be a case of the headline-writing department being out of sync with the article-writing department (again). The text of Kevin Vandenboss’ article actually supported the opposite conclusion. It all came down to definitions—but thinking about those could make it well worth the promised “3 min read.” A few main points:
- As investment techniques become more and more exotic, Buffett remains wedded to the simplest of Wall Street investment strategies: invest in solid companies with long-term growth prospects and ignore the market “noise” that panics most investors.
- Real estate “investing” means a Wall Street-style gambit into real estate investment trusts (REITs), something Buffett “isn’t opposed to.”
- Real estate “buying” as an investment really means “buying and managing” (being a landlord)—so it’s actually more of a business than a straight-out investment.
- Buffett feels that his time is better spent “investing” than running such a business.
That was a pretty tricky (or, more charitably, “artful”) way to construct a headline that draws clicks by seeming to red-flag real estate purchases. It is definitely true that Warren Buffett’s time would be more appropriately spent brainstorming multi-billion-dollar investment vehicles than overseeing a few Costa Mesa rental properties (although, in reality, he’d probably hire a rental management company for that).
The long and short of it is that anyone who is unaware that landlords are not completely passive investors might do well to investigate further—and in any case, that strategy is “a different story” than being the Godfather of Berkshire Hathaway. Not only that: Buffet believes it’s a story that “when scaled to comprise several properties can build significant wealth.” Although Buffet is strongly against using leverage in stock market purchases, “people should and do buy real estate using leverage, so the returns can be much greater.”
It does look like Warren won’t be calling here anytime soon, so if you’d like to explore the current Costa Mesa real estate opportunities, we’ll be free to help!
We are built on a philosophy of Heritage & Hustle. The L3 is a full service real estate agency with a regional office located in the heart of #CostaMesa, offering a wide-array of custom services to meet their clients’ needs with roots in the community since 1976. It’s L3 mission is to provide trusted, convenient, responsive service to ensure clients enjoy their real estate experience. The L3 was originally formed to offer personal, concierge-level service as an alternative to the large, nationally based real estate companies. From its small beginnings of only two employees, The L3 has grown to a full staff of 25 serving over 300 clients a year. The L3 is not limited to serving just its clients; it is also committed to serving the community. Not only has The L3 donated hundreds of hours to many area charities, they have also received the prestige of being named one of the #toprealestatecompaniesinCostaMesa If you’re interested in #buyingorsellinginOrangeCounty, turn to the experts. Turn to The L3 and let them help you make your real estate buying or selling dreams come true. For more information or to get started on finding or selling your home contact The L3 today at 714-444-4663 or email us at info@thel3.com
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