Real estate has long been considered a lucrative investment option for building wealth, and some of the world’s wealthiest individuals are no strangers to this fact.
In fact, three of the five richest people in the world are currently making unique plays in the real estate industry. From buying up vast swaths of land to investing in cutting-edge technology, these billionaires are setting themselves apart in a field that has been a cornerstone of wealth creation for centuries.
Warren Buffett
Legendary investor Warren Buffett is betting on a strong housing market recovery. His recent purchase of 1.25 million shares in Louisiana-Pacific Corp suggests he believes the housing market has bottomed out.
Berkshire Hathaway’s latest SEC filing reveals a 7% stake in the homebuilding solutions company, worth $417.1 million, indicating Buffett sees value in the firm, which could see growth as the housing market recovers.
This latest move underscores Buffett’s commitment to investing in companies that stand to benefit from long-term trends, such as the growing demand for housing in the coming years.
With his track record of successful long-term investing, his bet on the housing market could be a positive sign for the sector, the broader economy and the individual investor since new companies have made it possible to gain exposure to the real estate market with minimal capital.
If Buffett’s bet is right, a $100 investment (or more, depending on your appetite) in a rental property could prove to be a smart play.
Jeff Bezos
Amazon.com founder Jeff Bezos is no stranger to investing in the housing market either — he backed a company that allows investors to purchase shares of single-family rentals in up-and-coming neighborhoods for as little as $100.
The Bezos-backed company, which had other investors including Uber Technologies Inc CEO Dara Khosrowshahi and Salesforce Inc Co-CEO Marc Benioff, purchases properties with the highest appreciation potential, which are then listed online where nonaccredited investors can purchase shares with a single click to earn passive income through rent while their shares appreciate in value.
Elon Musk
Mostly known for his electric car company Tesla, space exploration company SpaceX and his recent acquisition of Twitter, Elon Musk has his eyes set on a new income stream deriving from real estate.
Musk could be partnering with the construction firm, Lennar Corp to build a residential area for employees of his companies.
The project, dubbed “Project Awesome,” will consist of 110 homes in Bastrop County, Texas, near the Boring Company and SpaceX facilities. The subdivision has already been approved for development and will address the growing need for housing in the area due to the thousands of jobs created by Musk’s companies.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
