Posts Tagged Warren Buffett

Vail Valley Real Estate Market Update, November 2012


Welcome to your November Real Estate Market Update.  Our local market is finally transitioning from a buyer’s market to a more traditional and balanced market.

In addition to my update on the overall real estate market, this report contains stories on:

Click on the link below to view the market update.

Market Update, November 2012

Vail and Beaver Creek Ski Resorts are now open.  Here’s hoping the storm forecast for early next week brings plenty of snow.

 

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Bachelor Gulch Real Estate Market Update, November 2012


Welcome to your November Bachelor Gulch Real Estate Market Update.  The recovery continues in our local market.  We will see an increase in activity for Bachelor Gulch in 2012 compared to 2011.

In addition to the latest BG real estate stats and trends, the market update contains stories on:

  • Warren Buffett makes a huge bet on the US Housing Market
  • Absorption Rate drops below 10 months for the overall real estate market in the Valley

Click on the links below to view the market update and the current BG condo and town home listings and 2012 sales.

Market Update, November 2012

Listings & Sales, November 2012

Beaver Creek opened on Wednesday to a beautiful day.  We can use some more snow and a storm is forecast for early next week.  Here’s hoping for a dump!

 

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Warren Buffett Just Made A Huge Bet On The US Housing Market


Perhaps the most bullish indicator for U.S. housing is Warren Buffett.

The legendary investor has been buying up real-estate brokerages around the country as he bets on a housing turnaround. Now, he is partnering with Brookfield Asset Management, a Canadian real-estate investor, to more than double the size of his brokerage business

Berkshire’s HomeServices of America Inc. unit will be the majority owner of the venture to manage a U.S. residential real-estate affiliate network, according to a statement on the new company’s website. The firms plan to offer a new franchise brand, Berkshire Hathaway Home Services, starting next year. Brookfield’s network has operated under the Prudential Real Estate and Real Living Real Estate brands.

Berkshire’s managers have been positioning the firm to benefit as the U.S. home market recovers from its worst slump in seven decades. The Omaha, Nebraska-based company has bought a brickmaker, won the loan portfolio of bankrupt mortgage lender Residential Capital LLC at auction and built its HomeServices unit by agreeing to acquire real-estate brokerages in states including Oregon and Connecticut.

The press release says the brokerages that will make up the new company did a combined $72 billion in sales in 2011. That’s more than twice the $32 billion in sales that Berkshire did in 2011 without the new brokerages.

More from the release:

The combined networks of more than 53,000 Prudential Real Estate and Real Living Real Estate agents generated in excess of $72 billion in residential real estate sales volume in 2011, and operate across more than 1,700 U.S. locations.

“Berkshire Hathaway HomeServices is a new franchise brand built upon the financial strength and leadership of Brookfield and HomeServices,” said Warren Buffett, chairman and CEO of Berkshire Hathaway Inc. “I am confident that these partners will deliver value to the residential real estate industry, and I am pleased to have Berkshire Hathaway be a part of the new brand.”

“The strength of the Berkshire Hathaway name, coupled with the operational excellence of HomeServices and the franchising experience of Brookfield, positions Berkshire Hathaway HomeServices® as a leading real estate franchise in the U.S., building on our traditions of exceptional client service and innovation. Brookfield is excited to be a partner in creating a home for the best real estate brokers and agents in the country,” said Bruce Flatt, Brookfield Asset Management CEO.

Buffett has been public about his bullish housing call for a while as he’s built his residential real-estate brokerage business, but this is a big addition.

 

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Rosen: Buffett’s Tax Fraud


Perched next to Michelle Obama at President Obama’s State of the Union campaign speech, in full view of the TV cameras, was Warren Buffett’s secretary, the woman who Buffett tells us pays more taxes than he does, her multibillionaire boss. She served as a convenient prop for Obama’s latest round of class warfare. I deconstructed Buffett’s specious claim four years ago when he first made it. Apparently, it’s time for an update.

His assertion is that he and the super rich pay a lower tax rate than their “secretaries and receptionists.” The key word here is “rate.” Obviously, when considering the amount of total tax dollars collected, the rich pay an inordinate share — far more than their “fair share” — of the overall income tax burden. The top 1 percent pays 37 percent of all individual federal income taxes; the top 10 percent pays 70 percent; and the bottom 50 percent carries only 2 percent of the burden.

Buffett extracts a pound of lie from an ounce of truth while throwing in a heavy dose of half truths and convenient omissions. While it’s true that rich and not-so-rich investors pay lower tax rates on things like capital gains, dividends, and interest on municipal bonds than is paid on ordinary wage and salary income, there are perfectly good reasons for that.

Corporations that pay dividends to shareholders do so with after-tax dollars, having already paid a corporate income tax on their earnings. The lower tax rate that shareholders

have paid in the past on dividend income when they file their individual tax returns serves to offset some — but not all — of this double taxation. (The lower tax rate on ordinary dividend income, unfortunately, is being eliminated.)

Likewise, the capital gains tax is also double taxation, as eloquently explained by economists Victor Canto and Harvey Hirschorn in more words than space allows here. Moreover, if a stock increases in value over the years, much of the gain is illusionary, eroded by inflation. The capital gains tax makes no allowance for this. A lower tax on capital gains is a productive incentive for people to defer current consumption and invest in the future, creating wealth for themselves and society.

But Buffett’s worst manipulation is lumping together income taxes and payroll taxes in the comparison with his secretary. Payroll taxes are for specifically dedicated programs like Social Security and Medicare. Investment income isn’t and shouldn’t be subject to the payroll tax, and Buffett has far more investment income than his secretary.

Income taxes are sharply progressive, with almost 50 percent of Americans paying nothing at all. Conversely, a uniform Social Security tax rate (normally 6.2 percent each for employee and employer; although a 4.2 percent employee rate is temporarily in effect) is levied on an employee’s salary, capped at an income limit of $110,100 in 2012 (increasing each year with inflation). So, obviously, a lower-salaried secretary would pay a greater percentage of her income in payroll taxes than a much higher-salaried boss whose income is well above $110,000. But, again, this is for good reason. Social Security benefits are similarly capped. From its inception, Social Security was described as a forced savings plan for your own retirement or disability. If the Social Security tax on individuals had no limit, it would be just another income transfer/welfare program, which is precisely what liberals want.

With no cap, the normal, combined employee/employer rate of 12.4 percent on a $1 million salary would result in a tax of $124,000 in 2012 instead of $13, 652. That’s an increase of about $110,000. On a $10 million salary, that would be a tax increase of about $1,226,000. And this would be on top of income taxes, which Democrats also want to increase. This is grand larceny.
Read more: Mike Rosen – The Denver Post http://www.denverpost.com/rosen#ixzz1lFSOz4s8

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