Warren Buffet's mantra - 'Buy when no one else is'. So, why aren't you?

Conrad

mewbie wrote: »

So did Bernie Madoff, Stanford, etc. I am not suggesting anything of the kind for the sainted Warren Buffet but his basic strategy is / was to buy into names (Pepsi,etc.) and sit on it for a very long time. Pretty simple stuff.

A genius or just very old?

His strategy was a little more involved. He tended to buy when no one else dared. He is one of the rare individuals that has the ability to see beyond the end of next week.

He views most news as mere back ground noise.

In terms of the South Eastern British property market, I can well imagine he would state now is the time to buy when peak paid and gloom abounds, and yes, even against a back ground of temporary rising unemployment

You get bigger fish if you have the pond to yourself:cool:

TDS_2

Houses are very illiquid assets, and as such prices are slow to adjust (2% a month is pretty lethargic compared to gold, say, which can happily shed that in a few hours). Therefore, it's unlikely that anyone ready to make the purchase (healthy deposit in place, mortgage offer, no onward chain etc.) could possibly miss the 'bottom'.

Prices are not gonna reverse overnight while the majority are in no position to buy - repaying debt / loking for work / saving a deposit. There are many ppl on this forum that are (claim to be) waiting, ready to make the swift move when the opportune moment arises. However, I don't think this is representative of the public at large.

Don't forget that as soon as things start to look better interest rates (and therefore mortgage costs) will rise. Things will be tough/subdued for many years to come, and the bubble will only begin to reinflate when the country as a whole start to feel wealthier.

Just my opinion...

mewbie_2

Conrad wrote: »

In terms of the South Eastern British property market, I can well imagine he would state now is the time to buy...

You may well imagine it, but he hasn't actually stated it as far as I know. However, could be he is in talks with the Wilsons right now...

Reaper

Conrad wrote: »

Regardless of your own situation, the principle still applies - there is a 'best' time frame in which to buy, but 99% will miss it because fear has zombiefied them.

Don't get me wrong, I largely agree with you. Personly I am a contrarien investor so I do tend to buy when others do not. However my personal view is that the market still has further to drop and the recession will be closer to "L" shape than "V" shape. There is therefore no rush to buy.

My current plan is to start investing on a monthly basis when the market is around 3500 - if I can find suitable opportunities of course.

Warren has been able to start before me because he has opportunities that I do not.

Masomnia

It's a good principle, ie. not letting your emotions control your investment decisions, but you'd be an idiot to take it as an infallible axiom.

"Ah, everyone's selling Northern Rock, now's the time to buy!"

JayScottGreenspan

Conrad wrote: »

His strategy was a little more involved. He tended
In terms of the South Eastern British property market, I can well imagine he would state now is the time to buy when peak paid and gloom abounds, and yes, even against a back ground of temporary rising unemployment

No, he'd look at rental yields and wait for further falls. If rental yields of 12%-15% (a la Swiss Re and Harley) were on the table it might be different.

BTW, the capital value of his Swiss Re dealings has been badly hit. He shot his bolt too early on that one.

Laughing_man

Conrad wrote: »

Regardless of your own situation, the principle still applies - there is a 'best' time frame in which to buy, but 99% will miss it because fear has zombiefied them.

I don't follow, are you calling a 'bottom'? Is now the best time to buy? If so, why?

Or are you just bored and trolling because no-one wants mortgages today?

Anyway I prefer: 'It's time to buy when the last bull turns bear'

tara747

TDS wrote: »

Houses are very illiquid assets, and as such prices are slow to adjust (2% a month is pretty lethargic compared to gold, say, which can happily shed that in a few hours). Therefore, it's unlikely that anyone ready to make the purchase (healthy deposit in place, mortgage offer, no onward chain etc.) could possibly miss the 'bottom'.

Prices are not gonna reverse overnight while the majority are in no position to buy - repaying debt / loking for work / saving a deposit. There are many ppl on this forum that are (claim to be) waiting, ready to make the swift move when the opportune moment arises. However, I don't think this is representative of the public at large.

Don't forget that as soon as things start to look better interest rates (and therefore mortgage costs) will rise. Things will be tough/subdued for many years to come, and the bubble will only begin to reinflate when the country as a whole start to feel wealthier.

Just my opinion...

This is exacty what I was going to say, TDS, so I will just quote yours for extra emphasis.

Warren Buffett deals in stocks and shares, NOT property. He has lived in the same modest house in Omaha for decades and does not see property as a 'get rich quick' scheme, thank goodness. S&S are very liquid, you need to be quick to buy/sell at the right time. Property is highly illiquid. We will all see the bottom of the market as it will last for ages. This is going to be a U-shaped property crash imho.

There will be plenty of time to buy at or around the bottom. Personally, I would rather buy just past the bottom than too soon. With the huge oversupply of property around and the bad state of the economy (with taxes and interest rates likely to rise sharply in the near future), there won't be much competition will there???

House prices in NI fell by 34.2% in 2008, that is not going to just stop! I will wait till they stop falling by 3% per month and then think about buying.

As for the Wilsons and their ilk, they deserve everything that's coming to them. :cool:

stevetodd

JayScottGreenspan wrote: »

No, he'd look at rental yields and wait for further falls. If rental yields of 12%-15% (a la Swiss Re and Harley) were on the table it might be different.

BTW, the capital value of his Swiss Re dealings has been badly hit. He shot his bolt too early on that one.

Average yelds will not get anywhere near 12% unless of course you are talking about real dubious property (i.e. slums etc.) that is seriously blighted

geoffky

Conrad wrote: »

even against a back ground of temporary rising unemployment

f:cool:

How long do you think TEMPORARY rising unemployment is going to be temporary??? 1 year 2 years ect ect....