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Will Buffett’s reasons convince you to invest in a home of your own?
Key points
- Warren Buffett has made billions by investing.
- He considers his home one of his best investments.
- The reasons he believes his home is such a good investment may surprise you.
Warren Buffett is one of the best known investors of all time and he’s made billions of dollars with his investing skills. But despite the tremendous wealth the Oracle of Omaha has produced, he still considers his home to be his third best investment.
Here’s why Buffett believes his home has been such a great purchase.
Why does Buffett consider his home to be such a good investment?
In 2011, Buffett addressed the best investments he had ever made in his life. Perhaps surprisingly, the billionaire didn’t talk about the companies he’d purchased or the stocks he bought that made him billions.
Instead, Buffett said, “All things considered, the third best investment I ever made was the purchase of my home, though I would have made far more money had I instead rented and used the purchase money to buy stocks. (The two best investments were wedding rings.)”
Buffett’s words are an important reminder that a house isn’t just a financial investment, but an emotional one as well. Buying a home enables you to create stability for yourself and your loved ones, as well as to hopefully build wealth over time when you pay down your loan and your property appreciates in value.
Because of both the financial and emotional benefits, Buffett made clear that “Home ownership makes sense for most Americans, particularly at today’s lower prices and bargain interest rates.”
There’s an important caveat to homeownership being a good investment
While Buffett is clearly supportive of homeownership, he also included an important caveat that anyone who is thinking of purchasing a property absolutely needs to consider.
Right after declaring buying a home to be one of the best investments he ever made and suggesting that most people should consider purchasing a property, Buffett went on to say that “a house can be a nightmare if the buyer’s eyes are bigger than his wallet and if a lender — often protected by a government guarantee — facilitates his fantasy.”
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