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Charlie Munger was an investing magnate whose life spanned multiple decades. He died at age 99 on November 28, 2023. His legacy is truly iconic, having built several incredible companies over the years — most notably Berkshire Hathaway — alongside the Oracle of Omaha himself, Warren Buffett.
Munger’s mix of humor and profound insight in simplifying complex concepts into sayings that people can understand still resonates with so many investors.
Among Munger’s well-known views is that homes should be reserved for families who intend to live in them. At the 1998 Berkshire Hathaway Annual meeting, Munger famously quipped, “The single people, I don’t care if they ever get a house.”
Regardless of marital status, real estate remains one of the best wealth-building assets for middle-class families. Approximately 45% of household net worth in America is tied to primary residences, with an even larger percentage linked to real estate investments.
Here’s what investors should consider about real estate as a long-term asset class.
For most individuals, the most significant investment one will ever make is in their primary residence.
The ability to take on a highly leveraged position in real estate and grow equity as property values rise over time offers significant financial benefits. Instead of paying rent and having ‘nothing’ to show for it after 30 years, homeowners who make their monthly mortgage payments will accumulate substantial equity by retirement. This “forced savings” phenomenon is a key reason why most household net worth is so often tied up in real estate.
There are several options for those looking to expand their residential real estate portfolio beyond their primary residence, or invest in real estate while saving for a down payment on their own home.
New investing platforms are making it easier than ever to tap into the real estate market.
For accredited investors, Homeshares gives access to the $36 trillion U.S. home equity market, which has historically been the exclusive playground of institutional investors.
With a minimum investment of $25,000, investors can gain direct exposure to hundreds of owner-occupied homes in top U.S. cities through their U.S. Home Equity Fund — without the headaches of buying, owning or managing property.
With risk-adjusted target returns ranging from 14% to 17%, this approach provides an effective, hands-off way to invest in owner-occupied residential properties across regional markets.
If you’re not an accredited investor, crowdfunding platforms like Arrived allow you to enter the real estate market for as little as $100.
Arrived offers you access to shares of SEC-qualified investments in rental homes and vacation rentals, curated and vetted for their appreciation and income potential.
Backed by world-class investors like Jeff Bezos, Arrived makes it easy to fit these properties into your investment portfolio regardless of your income level. Their flexible investment amounts and simplified process allows accredited and non-accredited investors to take advantage of this inflation-hedging asset class without any extra work on your part.
After establishing a diversified residential real estate portfolio, you might seek additional investment opportunities for further growth. Commercial real estate has been one of the best-performing asset classes in recent decades, often offering higher appreciation and cash flows compared to residential real estate. Consequently, many investors turn to commercial real estate after purchasing their home.
For years, direct access to the $22.5 trillion commercial real estate sector has been limited to a select group of elite investors — until now.
First National Realty Partners (FNRP) allows accredited investors to diversify their portfolio through grocery-anchored commercial properties, without taking on the responsibilities of being a landlord.
With a minimum investment of $50,000, investors can own a share of properties leased by national brands like Whole Foods, Kroger and Walmart, which provide essential goods to their communities. Thanks to Triple Net (NNN) leases, accredited investors are able to invest in these properties without worrying about tenant costs cutting into their potential returns.
Simply answer a few questions – including how much you would like to invest – to start browsing their full list of available properties.
Mogul is a real estate investment platform offering fractional ownership in blue-chip rental properties, which gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or 3 A.M. tenant calls.
Founded by former Goldman Sachs real estate investors, the team hand-picks the top 1% of single-family rental homes nationwide for you. Simply put, you can invest in institutional quality offerings for a fraction of the usual cost.
Each property undergoes a vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18.8%. Their cash-on-cash yields, meanwhile, average between 10 to 12% annually. Offerings often sell out in under three hours, with investments typically ranging between $15,000 and $40,000 per property.
Every investment is secured by real assets, not dependent on the platform’s viability. Each property is held in a standalone Propco LLC, so investors own the property — not the platform. Blockchain-based fractionalization adds a layer of safety, ensuring a permanent, verifiable record of each stake.
Getting started is a quick and easy process. You can sign up for an account and then browse available properties. Once you verify your information with their team, you can invest like a mogul in just a few clicks.
Read more: Warren Buffett says you can’t buy time — but landlords are finding a way. Here’s how savvy real estate investors are avoiding 12 hours a month in tedious admin (for free)
Investing in REITs or ETFs will give you access to the growth of the real estate market through the stock market. There are also a number of funds that offer diversified exposure to different types of real estate assets, so you can spread your risk and ensure balance in your portfolio. These assets can include residential, commercial, and industrial properties.
Even with a diversified investment in real estate funds, you’ll want to make sure you’ve got the right strategy and research behind you.
The team of former hedge fund analysts and experts at Moby spend hundreds of hours each week sifting through financial news and data to provide top-tier stock reports to keep you up-to-date on what’s moving the markets.
Moby’s superior research can help you reduce the guesswork when selecting stocks and ETFs. In four years, across almost 400 stock picks, Moby’s picks have beaten the S&P 500’s returns by almost 12%, on average.
With their jargon-free formats, you can become a wiser investor in just five minutes, backed by a 30-day money back guarantee.
However, reliable advice isn’t the only thing you’ll need to become a real estate mogul.
Great money makers need great tools, and that’s where Public comes in.
Public not only offers commission-free trading but also provides a high-yield account where you can park your cash between investments. Public also has social features, enabling users to follow and learn from other investors, share ideas, and stay updated on market trends with real-time insights.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.