Warren Buffett auctions a lunch date for charity every year, and the winning bid usually stretches to seven figures. He twice sold his used cars to fans for multiples of their Kelly Blue Book value. Someone once even paid more than $200,000 to purchase his old wallet. (It had a stock tip inside.) For those who venerate one of the world’s best investors, money is usually no object when buying a piece of the legend.
A year ago, Buffett put his vacation home in Emerald Bay, a gated enclave next to Laguna Beach, Calif., up for sale. He bought the property in 1971 at the urging of his first wife, Susan, for $150,000—the equivalent of a bit less than $1 million today. At the time, he didn’t think of it much as an investment, he told the last year. Laguna was less developed back then, more surfer-and-hippie paradise than multimillionaire’s haunt. The couple and their family often spent summers at the home, as well as time around Christmas, when Buffett would hole up in the master bedroom working on his closely followed annual letter to Berkshire Hathaway Inc. shareholders.
Over the years, Buffett upgraded the home, which was built in 1936. He even bought an adjacent property for guests to sleep in. When Susan died in 2004, Buffett—who lives most of the year in Omaha, Neb.—stopped going to the house as much, which is why he finally decided to list it. His asking price: $11 million.
“For the first time in nearly 50 years the legendary ‘Oracle of Omaha’s’ home 27 Emerald Bay is now available!” the listing began, before going on to describe the almost-3,600-square-foot property’s six bedrooms and sea views. Staged photos of the interior played up the association with the billionaire investor. A living room shot, for instance, is decorated with a life-size cutout of Mary See, whose face adorns boxes of chocolates sold by Berkshire’s See’s Candies. In another room, an open bottle of Coca-Cola and a folded rest on a side table in front of a TV tuned to CNBC. (Berkshire is Coca-Cola Co.’s biggest shareholder, and Buffett is a frequent guest on the business news channel.)
The finishes and amenities appear to be relatively modest. One bathroom is wallpapered in old covers, and most of the kitchen counters are white laminate. The garage fits just one car, and the ocean view is partially obscured by other homes.
After the initial buzz and several write-ups in the press, interest in the property seems to have fizzled. It’s now been on the market for about five months longer than the median listing time for similarly priced homes in the same ZIP code, according to data compiled by Redfin. Bill Dolby, the listing agent, and Buffett didn’t respond to requests for comment about the home or how they decided on a price.
At the high end of the market, sales can be idiosyncratic—there’s a limited number of potential buyers, and they can be demanding. Still, other local real estate agents who work with high-end clients say it’s clear why the property hasn’t sold yet. “No one’s going to rehab a house from 1936,” says Eliisa Stowell, a realtor with Surterre Properties in nearby Corona del Mar. “It might have sentimental value to someone, but then it’s gone” when the home gets torn down to build something more modern, she says. Bill Cote, a Newport Beach-based realtor with Coldwell Banker, is more blunt: “It’s dreadfully overpriced,” he says. The Buffett name, he adds, probably doesn’t do much for buyers in the area. “If you said it was Bette Midler’s house, it might have some cachet,” Cote says.
Then again, buyers who do know Buffett might be nervous about being on the other side of a negotiation with him. One secret to Buffett’s success as a businessman and investor has been his unwillingness to bend on price. Whether he’s looking at a stock or a whole company, the billionaire has a strong idea for what he thinks things are worth and isn’t afraid to walk away if his terms aren’t met. Having more money than he’ll ever need means he’s never a forced buyer or seller. As Cote says, “It’s hard to get into a conversation with a seller who’s got more money than God.”