Housing Market Forecast Beyond 2012 From Warren Buffett
Buffett believes purchasing a home with ultra-low mortgage rates and holding it for the long-term has become a better investment than stocks right now.
By Hao Li
Palm Coast, FL – March 1, 2012 – Legendary investor Warren Buffett just gave a rosy housing market forecast for beyond 2012 in his annual letter to shareholders.
"Housing will come back - you can be sure of that," said Buffett.
In the long-term, the housing market forecast is driven by supply and demand.
In the years prior to 2008, the U.S. added more housing units than there were households formed.
From 2002 to 2007, annual housing starts averaged 1.34 million while household formation average 1.05 million.
This excess was fueled by a speculative frenzy that saw people buying properties (as either primary residences or investments) they could not afford.
In 2008, the housing market "bubble popped with a violence that shook the entire economy," said Buffett.
Read More >>>> International Business Times [Feb. 28. 2012]