# @benzinga on YouTube

- **Type:** Video
- **Original URL:** https://youtube.com/watch?v=e4BgAeUSaXU
- **Gondola URL:** https://gondola.cc/posts/69265922-benzinga-youtube
- **Thumbnail:** https://img.gondola.cc/tr:w-,h-,fo-auto/postThumbnails/a6508c0389.jpg
- **Posted:** 2026-08-14T19:00:35.000+00:00
- **Account Owner:** Benzinga | News That Moves (@benzinga) — https://gondola.cc/benzinga

## Caption

Charlie Munger built his first fortune flipping real estate five projects in Southern California in the 1960s that made him three to four million dollars while he was still practicing law. That money is what let him quit the law firm and go full time into investing alongside Warren Buffett. And yet at Berkshire Hathaway's 2002 annual meeting, Munger stood up in front of thousands of shareholders and called real estate "a very lousy investment." How does the guy who got rich off real estate call it lousy? The answer is one of the most important lessons in all of investing: the same asset can be brilliant in one structure and terrible in another. Munger was crystal clear about what he meant. Real estate is a lousy investment specifically for companies taxed under Subchapter C of the tax code traditional C-corporations like Berkshire Hathaway. Why? Because a C-corp buying real estate gets hit with a whole extra layer of corporate tax on top of what an individual investor or a REIT would pay, and on top of that, Berkshire has no competitive edge against specialized real estate firms with decades of experience. It made no sense for Berkshire. It made perfect sense for individual Charlie Munger, working alone, taxed as a person, in his 30s and 40s. And Munger's personal life reflected the same practical thinking. He lived in the same modest Pasadena, California home for roughly 70 years, from around 1953 until his death in November 2023. Speaking to CNBC in his final year, he said fancy houses "make the person less happy, not happier" and that "having a basic house really helps you." The takeaway: before you copy any billionaire's strategy, make sure you are copying it in the right structure. Munger got rich in real estate as an individual. He was right to keep it out of Berkshire. Both statements are true at the same time. That is the Munger lesson most people miss.
Image via Shutterstock: [Kent Sievers](https://www.shutterstock.com/g/Kent+Sievers)
#CharlieMunger #BerkshireHathaway #realestate

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## Stats

- **Views:** 2,339
- **Likes:** 23
- **Shares:** 0
- **Comments:** 1

## Tags

berkshirehathaway, realestate, charliemunger

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