Buffett Back on Board!

The Global Investing blog on Reuters points out that Warren Buffett is getting back into the real estate market. I think Buffett is a genius and this news is definitely another vote in favor of the economy turning around soon.

However, the thing everyone needs to remember with Buffett is that his time horizon for a long term investment is probably a lot longer than most other people's. Though housing may have hit a bottom, that does not necessarily mean that it will definitely be a good investment for the next 5 years or so. Actually it might be, but that's not to say that there aren't other better investments available.

And heaven forbid, if haven't seen the bottom, then housing is one of the most illiquid investments to be in! Just tossing in my two cents to say that people should not read this news as a signal to get long second mortgages again!

You have a mortgage? Oops! Maybe you can't choose where you live!

An interesting post on the ever excellent Planet Money blog points out how the recession is preventing people from moving around, as they are staying put in their mortgaged home (that might be underwater on the mortgage). What would be interesting to see is whether a whole generation grows up being less likely to own a mortgage, and preferring instead to rent. Or maybe home ownership as part of the American Dream is just too deeply embedded in the American psyche?