Warren Buffett on Real Estate

At the latest Berkshire Hathaway shareholder's meeting, Warren Buffett and his partner Charles Munger had something to say about the real estate bubble.

Here are some excerpts from Money Magazine's article on the subject:

Here's what Warren had to say about recent real estate speculation:

"The day traders of the Internet moved into trading condos, and that kind a speculation can produce a market that can move in a big way. You can get real discontinuities.

We've had a real bubble to some degree. I would be surprised if there aren't some significant downward adjustments, especially in the higher end of the housing market"

And here's Munger on mortgages:

"There is a lot of ridiculous credit being extended in the U.S. housing sector."

Hmm...could that ridiculous credit include a disproportional number of Adjustable Rate Mortgages and interest-only loans?

I think I've read something about those recently...