The man himself, Warren Buffet, has finally come out and said it.
[Within] a year or so residential housing problems should largely be behind us, the exceptions being only high-value houses and those in certain localities where overbuilding was particularly egregious. Prices will remain far below “bubble” levels, of course, but for every seller (or lender) hurt by this there will be a buyer who benefits. Indeed, many families that couldn’t afford to buy an appropriate home a few years ago now find it well within their means because the bubble burst.
WIth those words from his 2010 annual Berkshire Hathaway shareholder letter, Warren Buffett has set the housing industry on fire.
Buffett is best known for his investin prowess having made highly profitable investments in companies such as GEICO, and Coca-Cola. A single investment in Buffett’s company in 1965 would have yielded an 800,000 % return.
If housing were to go up, Buffett would stand to profit substantially.
Berkshire Hathaway owns Clayton Homes, a pre-fab housing company that saw a drop in profit by about 9% last year, and Shaw Industries, a carpet manufacturer that saw a drop in profit of about 30% last year.