By the way, if Warren Buffet believes we are approaching a recession, can someone explain why he just did this two weeks ago ...
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On Monday, Berkshire Hathaway disclosed to the U.S. Securities and Exchange Commission that it had made investments in three major U.S. homebuilders: D.R. Horton (No. 120 on the Fortune 500), Lennar (No. 119 on the Fortune 500), and NVR (No. 376 on the Fortune 500).
In total, Berkshire Hathaway bought 5,969,714 shares of D.R. Horton, 152,572 shares of Lennar, and 11,112 shares of NVR. Those shares are worth over $800 million—with more than $700 million of it being in D.R. Horton.
While Berkshire Hathaway CEO Warren Buffett did not publicly state the motive behind this investment, these stock purchases do coincide with a remarkable surge in U.S. homebuilder stocks.
The homebuilding sector has benefited from the scarcity of existing inventory available in the market. This scarcity, combined with the aforementioned affordability strategies, has further heightened the appeal of newly constructed homes. The resultant competition for a limited pool of existing homes has pushed potential buyers toward considering new-home options, boosting the sales figures for homebuilders. And that housing shortage could last for years.