Berkshire Hathaway Chairman Warren E. Buffett and Business Wire CEO Cathy Baron Tamraz ring the opening bell at the New York Stock Exchange after the opening bell on Wall Street In New York City on September 30, 2011. UPI/John Angelillo | License Photo
NEW YORK, Feb. 27 (UPI) -- Billionaire investor Warren Buffett said some people who lost their homes when the financial crisis hit came out ahead while their banks did not.
In an annual letter to shareholders, Buffett said it was a "largely unnoted fact: Large numbers of people who have 'lost' their house through foreclosure have actually realized a profit because they carried out refinancing earlier that gave them cash in excess of their cost."
"In these cases, the evicted homeowner was the winner and the victim was the lender."
Buffett also said "all of us participated in the destructive behavior" that lead up to the housing market crash.
"Government, lenders, borrowers, the media, rating agencies, you name it," he wrote. "At the core of the folly was the almost universal belief that the value of houses was certain to increase over time and that any dips would be inconsequential."
Buffett also said he "was dead wrong" when it came to predicting the housing market would begin to recover in 2011.
"Housing will come back -- you can be sure of that," he wrote. But in the meantime, he is keeping his optimism in check.
The problem: Too many homes and not enough customers.
"Inevitably, we ended up with far too many units and the bubble popped with a violence that shook the entire economy," he wrote.