What does Warren Buffett want you to realize about investing in real estate in today’s market?
Buffett continues to be regarded as one of the most legendary investors of all time. Among other things, ‘The Sage of Omaha’ has invested in real estate longer than most of those that will read this have been alive. Who else would you rather provide a few extra insightful tips on successfully investing in real estate today?
So if there are five lessons to take from Warren Buffett’s success, strategies and recent real estate moves, what would they be? The following is a list of 5 real estate investing tips that we should all be taking advantage of:
1. Now is the Time
As the pioneer of Berkshire Hathaway, Buffett has long regarded his own home as his best investment ever. He has also remained in the real estate investment industry throughout every phase of the housing cycle. However, he has made significant moves recently, including: going into the real estate sales business and branding it with the sacred Berkshire label.
In other words – if there was ever a time to take advantage of the market, this is it.
2. Use OPM
You wouldn’t think that a real estate investor with tens of billions of dollars in their bank would ever need to use a penny from someone else. Yet, Buffett is virtually using 100% of other people’s money (OPM) to invest today. This should be a huge wake up call for those aspiring real estate investors that are shying away from leverage.
3. Let Someone Else Manage it
As humble as he is, it’s doubtful Buffett would ever be caught dead self-managing any of his properties or businesses. Subsequently, he is much less likely knocking on doors to collect rent or picking up those notorious 2 am tenant repair calls. To picture it is absurd.
So for any real estate investor that aspires to gain even a small percentage of Warren’s wealth, would you derail your goals by resigning yourself to a long term property management job?
There can be a time for it, but self-managing rental property probably shouldn’t be a part of the big picture plan for most. Take the time to hire a professional property management company that you can trust.
4. Recruiting Top Talent
Buffett’s success is largely due in part to the talent he recruits, or more specifically his companies. You can’t be the best or have the best company unless you also have great talent and managers. So stop skimping and build the best team you possibly can.
5. Giving
Buffett would certainly want every real estate investor to know that giving back is far more rewarding and important than your Forbes 400 rank.
You can’t take absurd amounts of riches with you when your time is up. In fact, you can’t take any of it. Only those with bulging eyes, eager to find out how much they were left, will likely remember how much you profited. And those are probably not the ones you’ll want to leave a dime to.
Making money and securing your family’s future is great, but it does come to a point when the happiness level associated with making another dollar plummets. Eventually, it becomes more fulfilling to see how much good you can do with it.
