Warren Buffett House

Warren Buffett’s House: The $31,500 Home of a Frugal Billionaire

Warren Buffett is the world’s most famous investor. His illustrious career has spanned eight decades, earning him a net worth of $116.3 billion and the nickname “the Oracle of Omaha” for his uncanny ability to pick winning stocks.

Yet in a previous Berkshire Hathaway letter to shareholders, Buffett referred to his home as “the third best investment I ever made.” Not Apple or Coca-Cola. But the property he bought for $31,500 in 1958 and has lived in ever since. The two best investments, wrote Buffett, were wedding rings.

So what’s so special about Warren Buffett’s house? Why does it hold such appeal to the fifth richest man on the planet? And what else does Buffett have to say about homeownership in general?


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Warren Buffett House Features and Price

The first thing to note is that Warren Buffett’s house isn’t – at least by billionaire standards – anything special. Given the depth of his pockets, you might expect him to reside in a gated mansion in Beverley Hills, California, or the Hamptons, New York.

In reality, the Oracle of Omaha has lived the last 65 years in a relatively modest 5-bedroom, 2.5-bathroom property in Central Omaha, Nebraska. His 6,570-square-foot stucco house in a leafy suburb of Omaha’s Dundee-Happy Hollow Historic District is still large and lovely. But it’s far from extravagant.

As we noted earlier, Buffett bought it in 1958 for just $31,500. That’s around $330,650 when you adjust for inflation, almost $100,000 less than the median cost of houses sold in the United States last year. Furthermore, in today’s money, what he paid represents a paltry 0.00028% of his total net worth.

Compare that to Jeff Bezos, who reportedly paid $165 million for the Warner estate in Southern California in 2020. It has a 13,600-square-foot mansion and a swimming pool, tennis court, and two guesthouses. The Amazon founder and ex-CEO then paid a further $10 million for an adjacent property.

That makes Buffett’s place look like a dive. According to Zillow, Warren Buffett’s house could now be worth as much as $1,381,800, almost 44 times more than he paid. Yet for a man worth over $116 billion, it’s still safe to assume he cherishes it for reasons other than money. So what are the real reasons he says it’s his third-best investment.

Why Warren Buffett Will Never Move from His House

Memories and frugality. Buffett’s commitment to his Omaha property ultimately boils down to those two factors. In that same 2010 letter to shareholders, he wrote, 

“For the $31,500 I paid for our house, my family and I gained 52 years of terrific memories with more to come.”

He even admits the house wasn’t the optimal financial decision, saying, 

“I would have made far more money had I instead rented and used the purchase money to buy stocks.” 

But, as he explains, that was a price worth paying for the countless happy experiences he’d had with his family.

Buffett’s also known as a notorious penny-pincher. For example, it was in 2020 that he finally upgraded from a $20 flip phone to a smartphone. Warren Buffett also starts the day with a cheap McDonald’s breakfast. He might spend $3.17 on a bacon, egg, and cheese biscuit if he’s feeling prosperous. Or, if he’s not, he’ll pay $2.61 for two sausage patties.

It’s a similar story to Warren Buffett’s house. He doesn’t need a new home, so why move from the one he likes? “I’m happy there. I’d move if I thought I’d be happier someplace else,” he said in a 2009 BBC documentary.

“How would I improve my life by having 10 houses around the globe?… I don’t want to manage 10 houses and I don’t want somebody else doing it for me and I don’t know why the hell I’d be happier.” 

He’s content with what he has, telling the presenter, 

“I’m warm in the winter, I’m cool in the summer, it’s convenient for me. I couldn’t imagine having a better house.”

Buffett’s Thoughts on Homeownership

Unlike his business partner and fellow billionaire, Charlie Munger, Warren Buffett usually avoids real estate in favor of his proven long-term investing strategy. But that doesn’t mean he thinks you shouldn’t buy a home. Quite the opposite, in fact. Speaking to CNBC, he described it as a valuable asset “for a great many people.”

If you have a family and intend to be in the same place for a long time, then he’s particularly supportive of this investment, saying,

“If you know you’re going to live in a given area, or think it’s very likely, for a considerable period of time and you’ve got a family, the home is terrific.” 

Why? Because of the 30-year fixed-rate mortgage. In Buffett’s opinion, it’s “the best instrument in the world.”

“Because if you’re wrong and rates go to 2 percent, which I don’t think they will, you pay it off. It’s a one-way renegotiation. A 30-year mortgage is an incredibly attractive instrument for the homeowner, and you’ve got a one-way bet.”

In other words, if mortgage rates drop, you can refinance the loan to access the prevailing interest rate. At the same time, there’s no risk of your current rate increasing, regardless of how high rates get.

Remember the Example of Warren Buffett’s House 

Warren Buffett’s house provides insight into how this legendary investor achieved such impressive heights of success. First, he found a property he liked, purchased it and then watched its value increase exponentially over decades.

As a centibillionaire, he could buy whatever house he wanted. But why would he? Content with what he has and undistracted by greed, he can allocate funds to more lucrative pursuits and continue to grow his net worth.

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Danny Newman is a digital nomad, blogger, and content writer from the UK. A passionate traveler with a perpetual itch in his feet, he’s always on the hunt for the next big adventure.

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