Equity vs Real Estate — What does Warren Buffett prefer? Berkshire Hathaway CEO reveals, ‘So much harder…’

Omaha-based investment giant Berkshire Hathaway’s Chief Executive Officer (CEO), Warren Buffett, in the company shareholder meeting on Saturday, May 3, 2025, said that investing in real estate is harder than putting your money into stocks.

Buffett highlighted how, in the real estate sector, negotiating deals, spending time, and the involvement of multiple parties for ownership will make it harder for investors to invest compared to stocks. 

“Well, in respect to real estate, it’s so much harder than stocks in terms of negotiation of deals, time spent, and the involvement of multiple parties in the ownership,” said Warren Buffett, responding to the question of investments in real estate.

Buffett also highlighted that in the case of a real estate investment, if the investor lands themselves in some trouble, they have to deal with more people, compared to just equity holders in terms of stock market investment.

“Usually when real estate gets in trouble, you find out you’re dealing with more than just the equity holder,” he said.

In the shareholder meeting, Buffett was asked why he isn’t buying property assets amid high rates and economic uncertainties. 

Warren Buffett’s real estate guy

The billionaire value investor also admitted that the real estate industry has generated high returns at times when the price was lower. However, he also said that investing in the stock market was cheaper and easier for any investor.

Buffett also highlighted how the late Charlie Munger, who was the vice chairman of Berkshire Hathaway, passed away in 2023, was his go-to guy for real estate investments.

The billionaire said that Munger was involved in more real estate deals for Berkshire Hathaway than Buffett and made several deals in the last five years of his life.

“But he was playing a game that was interesting to him,” said Buffett in the meeting.

However, Buffett said that if Munger had a choice of investing between real estate and equity, he would have chosen equity.

“There’s just so much more opportunity, at least in the United States, that presents itself in the security market than in real estate,” said Warren Buffett. 

Problems of investing in real estate?

Warren Buffett also emphasised how real estate deals can be time-consuming, and as people have their sentiments and life choices based on real estate, finishing a deal likely takes time. However, in the stock market, stock deals worth billions can be conducted in a matter of minutes.

“The completion rate for working on anything in stocks, assuming you’ve got a meeting of the minds on price, is essentially 100 per cent,” said the value investor.

“In real estate, the negotiation just begins when you agree on deals, and then they take forever. For a 94-year-old, it’s not the most interesting thing to get involved in something where the negotiations could take years,” said Buffett.

The US stock markets have been subject to high volatility due to the ongoing trade war between the United States and other world nations over tariffs imposed by US President Donald Trump.

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