5 Home Buying and Success Making Tips from King Investor Warren Buffett

    Warren Buffet is well known as one of the most successful investors in the world. He is Chairman of Berkshire Hathaway, a holding company worth upward of $130 million, and a stock trader aficionado. Buffett attributes his financial successes to some basic investing principles which have also been translated into the real estate realm.
    The basic premise of home ownership is sound. Homes do increase in value over time. This premise once got distorted and eventually caused the housing crisis when Americans started buying multiple homes to cash in on what they assumed was guaranteed appreciation. Buffett says that the housing bubble was inflated by irrational widespread belief that home prices would only ever go up. This, plus buyers purchasing a home they couldn’t afford with no down payment, caused the bubble. “It’s totally a sound premise that houses will become worth more over time because the dollar becomes worth less,” says Buffett.
    Buy Low. It’s simple. Because a home’s value does not increase over time, it’s beneficial to purchase low. Buffett says, “Home ownership makes sense for most Americans, particularly at today’s lower prices and bargain interest rates.”
    Don’t wait too long to take advantage of low prices. Buying while prices are low can be stressful because of volatile economic markets and the fact that it’s impossible to predict them in the short term. However, there is more of a likelihood that the market prices will move higher well before the economy turns up.
    The smart way to own a home has three elements. The three elements are; a fixed mortgage, affordable payments, and long-term hold. Buffett advises, “only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
    Buying your dream home may lead to nightmares. A house can be a nightmare if the buyer’s eyes are bigger than his wallet. Always choose a house that you can realistically afford.

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