Charlie Munger talks about the 2023 real estate crash. In a recent interview with the Financial Times (FT), Charlie Munger talked about what he is seeing in the commercial real estate market. Billionaire investor Charlie Munger just issued a dire warning about what’s ahead for the US real estate market. Unlike most people who issue these types of predictions, Munger actually knows a thing or two about the topic. Before Charlie Munger rose to fame as the Vice President of Berkshire Hathaway and Warren Buffett’s right hand man, he was a real estate investor. In fact, Munger is still investing in real estate today. A firm that he invests in is one of the largest owners of apartment buildings in Southern California. This is why it got my attention when Munger warned about what is happening right now in the real estate market during a recent interview with the Financial Times. The impacts of which will be felt way beyond just real estate, sending ripple effects throughout the economy. Using his words, there is a lot of “agony” and pain out there in the real estate market right now, and it’s only about to get worse.
There are different types of commercial real estate. The types include multifamily (apartments), office, retail, and industrials. Charlie Munger talked about how some of these different types of real estate are struggling right now, office and retail especially.
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Love Charlie, but why are old people almost universally pessimistic? Note this video is over a year old and the “crash” still has happened.
In 2007, while working in real estate, I saw individuals buying newly constructed homes from builders with the intention of selling them before the closing of escrow to another buyer at a profit. However, when the crash occurred, many of these units were foreclosed upon, and I distinctly remember seeing the builder's plastic still on the carpets.
I believe they invest in the very things they tell people not to.
So capitalism is one big Ponzi scheme – got it.
You are using Charlie Munger to make your video looks good and credential. I will report to YT if you dont change the way you want to explain estate market. Please create your OWN content… Dont use a third party to credit your stuff.
did no one learn from 2008 you never get into a variable interest rate.
I have been a real estate investor my whole life. Commercial real estate especially retail is going to be crushed. Market dynamics have changes and it's not coming back. In residential It is the same old bubble and bust situation. There are places where prices went crazy and they are coming back down but that's not everywhere.
Lot’s of thirsty peeps want the housing crash, be careful what you wish for others, as the same will be wished unto you.
I feel so bad for all these poor investors that have been wiped out by rising interest rates…🥱
Could it be that the housing crash is on the agenda to make it easier for the millions of illegals to settle and take over the US?
is this a crash in prices cause i dont give a fuck if my monthly payments go down.
So what happened to Charlie Manger talking in this whole thing? A woman is talking and we don’t know what is true or not. That’s not what the title announced.
The LOVE of MONEY is the ROOT of EVIL! With the loss of investment and property violent actions will be taken!
Real estate crash. Crash, crash! 🙏🙏
There’s going to be so many banks going under the next 6 months you can’t loan more money than even close to what it should cost. Worse than 2008 So many people are just swiping their credit card and just paying the minimum payment and you are never going to make any ground doing so. Biden and our government has bankrupted our country when Trump was in office no matter what he has done in his past me and you have done just as bad in God’s eyes and that’s all that matters. Trump is a businessman not a nasty politician.
Greed takes away most peoples common sense!!!!
T r u m p 2 0 2 4
Warren the only pain is you!
Plenty of homeowners are locked into even lower rates. More than 82 percent have a rate below 5 percent, 62 percent have a rate below 4 percent and even close to a quarter of mortgage owners have a rate below 3 percent.Jun 15, 2023. The office, retail, and industrial s may take a dive, but we homeowners are setting pretty paying off our principle balance real fast. 😁
This guy knows what he is talking about 2023 and 2024 will be brutal. Interest rates and inflation will hit the owners hard.
0:00: Munger, a real estate investor himself, predicts a worsening real estate market with ripple effects on the economy.
0:55: The story of Jay Gajavelli, a real estate syndicator, exemplifies the trends in the real estate market.
2:02: Gajavelli's investment strategy involved buying distressed properties with borrowed money, but rising interest rates posed a significant risk.
4:42: Smaller regional banks and credit unions now dominate lending in the real estate space.
5:04: The business model of banks relies on the assumption that borrowers will pay back their loans.
6:01: When a real estate project fails and the bank takes the property back, the bank suffers a loss.
9:09: The bank lost nearly forty percent of the loan amount in a $30,000 loss.
9:24: Losses in commercial real estate can quickly escalate to millions of dollars.
10:34: Local community banks will be most affected, leading to decreased lending and economic repercussions.
Recap by Tammy AI
Wow, that was a great break down. Thank you very much.
To make this very simple, fed banks, in the name of inflation, can hike interest rates to unfair %’s freely- but over doing it can hurt them as well 🧐
only morons buy things with debt when they have no idea what the interest rate will do.
then how could buffett be buying up dr horton and other homebuilders???? doesnt make sense
commericial property tanking is one thing….but I do not see this cancer really affecting invenrtory starved SINGLE FAMILY residential…..except in most over invested zip codes. Why do these guys like Monger keep RUMPR MUNGERing housing market forecast ? He was saying basicall same thing almost a year ago….How has that worked out so far ?
My house near LA has held its value pretty much all year. ..even gone up a little in 23.
BS
Yeah, duh, look at the phucking economy. Real estate is only the tip. Economic cycles are there for a reason, when you bastardize them like with the sniffy joe biden principles, you will "pay me later" think of the commercial. IF you let business cycles occur regularly, it flushes out the crap ones, but if you do the sniffy joe biden "you get a trillion, and you, and you, you all get a trillion," yeah, things will (are) phucked up. Thanks a lot sniffy joe, LET THE PHUCKING ECONOMY DO WHAT IT IS SUPPOSED TO DO.
Just buy Bitcoin
Does not make sense because post-pandemic supply is so low.
I've said this about cars and I'll say it about houses.
There's something very wrong with a market if it requires a near zero interest rate to keep it propped up.
Which they did for many years to paper over other systemic failures, namely wages not keeping up with inflation. Today we're seeing what that really means.
Imagine owning 7,000 toilets!