Why Warren Buffett Prefers Stocks Over Real Estate: Speed, Liquidity, and Scale

Warren Buffett has once again made the case for equities over property, saying real estate investing is slower, more complex, and less efficient than buying stocks, especially at scale.

The comments come from a resurfaced video of Buffett speaking at the 2025 annual meeting of Berkshire Hathaway, months after he stepped down as the firm’s chief executive on December 31, ending a three-decade run at the helm.

Speed and simplicity over negotiation

Buffett said real estate deals demand prolonged negotiations, extensive documentation, and the coordination of multiple parties, making them fundamentally different from equity investments. “In real estate, every sentence matters,” Buffett said, referring to contracts and deal structures. By contrast, stock transactions can be executed almost instantly if the price is right.

He pointed to Berkshire’s own experience, noting that while the company did pursue real estate opportunities during the 2008–09 financial crisis, the time and effort involved were disproportionate to the potential returns compared with securities.

Liquidity as the deciding factor

Buffett highlighted liquidity as a decisive advantage. Large equity transactions can be completed in seconds, while real estate deals can take weeks or months to close. This distinction matters most during periods of market stress, when speed and flexibility can determine outcomes. Distressed real estate assets may occasionally trade at attractive prices, Buffett acknowledged, but stocks have historically offered better value with far less friction.

Where Charlie Munger differed and agreed

Buffett noted that his longtime partner Charlie Munger enjoyed real estate investing and completed several deals later in life. Still, Buffett argued that if forced to choose early on, Munger would have picked stocks for their scalability and efficiency—suggesting that even real estate enthusiasts recognize the structural advantages of equities.