OMAHA — Berkshire Hathaway is continuing to build one of its biggest bets on the struggling U.S. housing market, increasing its stake in homebuilder Lennar to roughly 11% even as mortgage rates surge to their highest level in nearly three years and homebuyer demand weakens.
New regulatory filings show Berkshire now owns approximately 26.03 million Lennar Class A shares, up from about 23.72 million shares only days earlier.
The position is worth more than $2 billion at recent market prices and makes Berkshire a major shareholder in one of America’s largest homebuilders. Barron’s estimates the stake at roughly 11% of Lennar, after Berkshire nearly doubled its position during September.
But the newest filings reveal an important change.
Berkshire is still buying.
It just is not buying nearly as aggressively as before.
That slowdown raises a bigger question for investors:
Is Berkshire approaching the size of the Lennar position it wants — or is it simply waiting for an even better price?
Berkshire’s Lennar Stake Has Expanded Fast
Berkshire’s position has grown dramatically in a short period.
At the end of June, the conglomerate owned roughly 13.4 million Lennar shares.
By late September, that figure had climbed above 25 million. Business Insider reported that Berkshire had almost doubled its stake while Lennar shares were falling sharply amid worsening housing-market conditions.
SEC filings subsequently showed the position increasing from:
21.05 million shares
to
23.72 million
then
25.38 million
and finally
26.03 million shares.
That sequence shows Berkshire was buying repeatedly as Lennar’s stock weakened.
But the increments have become smaller.
The move from 21.05 million to 23.72 million represented an increase of roughly 2.7 million shares.
The next jump added about 1.66 million.
The latest increase added only around 656,000 shares.
That is why the slowdown matters.
Berkshire Is Buying While Lennar Is Under Pressure
This is classic contrarian investing.
Lennar shares have fallen heavily in 2026 as the U.S. housing market struggles under some of the highest mortgage rates in decades.
The stock closed around $81.59 on September 30, roughly 39% below its 52-week high of $133.76.
Barron’s reported the shares were down roughly 20% for the year around the time Berkshire doubled its position.
The weakness is not difficult to understand.
Buying a home has become dramatically more expensive.
And Lennar’s latest results show that affordability pressure is hitting builders directly.
Lennar’s Profit Has Been Cut by More Than Half
Lennar reported that third-quarter profit fell by more than 50% from a year earlier, as high mortgage rates reduced buyer demand and forced builders to offer more incentives.
That is a serious earnings decline.
Builders increasingly have to use:
mortgage-rate buydowns,
closing-cost assistance,
price cuts,
and other incentives
to convince consumers to purchase new homes.
Those tools help keep sales moving.
But they reduce profitability.
Lennar therefore finds itself in the middle of a difficult tradeoff:
maintain volume by sacrificing margin,
or protect margins and risk selling fewer homes.
Berkshire appears willing to tolerate that near-term pain.
Mortgage Rates Just Jumped to 7.28%
The housing backdrop has actually become worse since Berkshire started building its position.
The average 30-year fixed U.S. mortgage rate surged to 7.28% this week, up from 7.03% only one week earlier, according to Freddie Mac data reported by Reuters.
That was the biggest weekly increase in about four years and pushed mortgage rates to their highest level in nearly three years.
The difference sounds small.
For buyers, it is not.
AP estimated that the rate increase adds roughly $276 per month to the payment on a $400,000 mortgage compared with a year earlier.
For households already struggling with high home prices, insurance, property taxes and living costs, that can be enough to make a purchase impossible.
Existing-Home Sales Are Already Slowing
Higher rates are having predictable consequences.
U.S. existing-home sales fell 2% in August from July, reaching their slowest pace in more than a year, while mortgage applications dropped another 6% in the latest week.
There is also a massive “lock-in effect.”
Millions of existing homeowners secured mortgages at 3% or 4% during the pandemic-era low-rate period.
Selling their homes today could mean replacing that cheap loan with a new mortgage above 7%.
Many therefore stay put.
That reduces the supply of existing homes for sale.
Ironically, that can help builders such as Lennar because new construction becomes one of the few sources of available housing inventory.
That May Be Part of Berkshire’s Bet
This is where the Lennar investment becomes more interesting.
The U.S. housing market is weak.
But structural housing shortages have not disappeared.
If existing homeowners remain unwilling to sell because of their low mortgage rates, builders can capture a larger share of transactions whenever demand recovers.
That creates a long-term bull case for companies such as Lennar.
Berkshire may be betting that today’s profitability collapse is temporary while America’s long-term need for additional homes remains intact.
That would fit Berkshire’s traditional investing philosophy:
buy a strong business when short-term conditions make investors pessimistic.
Berkshire Already Knows Housing Extremely Well
Lennar is not Berkshire’s first housing investment.
Berkshire owns Clayton Homes, one of America’s largest manufactured-home companies.
Barron’s estimates Clayton could now be worth more than $25 billion, despite Berkshire acquiring the company for less than $2 billion in 2003.
Clayton has roughly 50% of the U.S. manufactured-housing market, according to Barron’s, and also operates a large home-financing business with a loan portfolio approaching $30 billion.
That gives Berkshire deep internal knowledge of:
housing demand,
mortgage affordability,
land development,
construction costs,
and buyer behavior.
So its Lennar investment is not simply an outside financial bet.
Berkshire already operates one of the biggest housing businesses in America.
Berkshire Has Gone Even Bigger With Taylor Morrison
Berkshire’s housing exposure expanded dramatically earlier this year.
The conglomerate agreed to acquire Taylor Morrison Home Corporation for roughly $8.5 billion, adding one of America’s largest traditional homebuilders to a portfolio already containing Clayton Homes.
That acquisition makes the Lennar stake even more notable.
Berkshire now has exposure to U.S. housing through:
Clayton Homes,
Taylor Morrison,
and Lennar.
That is no longer a small side investment.
It increasingly looks like a strategic theme.
Berkshire appears to be accumulating housing assets during one of the sector’s toughest affordability cycles in decades.
Lennar Could Be Complementary — or Competitive
There is also an interesting strategic question.
Lennar and Taylor Morrison compete directly in many U.S. markets.
That means Berkshire is now simultaneously:
owning Taylor Morrison outright,
holding a major stake in Lennar,
and controlling Clayton Homes.
Normally, companies do not invest heavily in direct competitors without a reason.
One explanation is simple portfolio investing.
Berkshire may believe multiple homebuilders are undervalued.
Another possibility is that the conglomerate sees the entire housing sector as offering unusually attractive long-term returns.
There is currently no evidence Berkshire intends to acquire Lennar outright, and investors should not assume its 11% stake means a takeover is coming.
But the rapidly increasing position naturally raises that question.
Berkshire Crossing 10% Changed the Disclosure Rules
Once Berkshire’s stake crossed 10%, it became subject to stricter SEC insider-reporting rules.
That is why investors are now seeing purchases disclosed through Form 4 filings relatively quickly instead of waiting for Berkshire’s quarterly 13F report.
The filings list shares held through several Berkshire insurance subsidiaries, including:
National Indemnity,
Medical Protective,
BHG Life Insurance,
AZGUARD,
NorGUARD,
and WestGUARD.
That gives the market an unusually detailed view of Berkshire’s buying.
And what those filings currently show is continued accumulation — at a slower rate.
Berkshire May Simply Be Managing Its Ownership Level
There may be a practical reason for the slowdown.
Once an investor becomes a major shareholder, continued buying can create complications.
A larger stake increases:
regulatory reporting requirements,
market-impact risk,
and questions about control.
Berkshire may simply be pacing purchases more carefully now that it owns more than 10%.
It could also be approaching an internal position-size limit.
Or managers may believe the stock has become less attractive after Berkshire’s own buying helped support the price.
Without comments from Berkshire, the exact reason is impossible to know.
This Is Happening After Buffett’s Leadership Transition
The Lennar purchases also carry symbolic importance because Berkshire is in a new era.
Warren Buffett stepped away from the CEO role at the beginning of 2026 and subsequently stepped down as chairman in September.
Greg Abel now leads the conglomerate.
Business Insider noted that the Lennar investment still looks remarkably consistent with Buffett’s old playbook: buying a fundamentally strong but out-of-favor business during a cyclical downturn.
The investment is believed to be overseen by Berkshire investment manager Ted Weschler, according to Barron’s.
So investors watching Lennar are also watching whether Berkshire’s investment culture changes in the post-Buffett era.
So far, it looks familiar.
Housing Could Be a Classic Berkshire Opportunity
Berkshire has historically favored industries where:
demand is durable,
competition is rational,
assets are tangible,
and temporary economic weakness can create attractive prices.
Housing fits that description.
People will continue needing homes.
The U.S. population will continue forming households.
Older housing stock needs replacement.
And land and construction capacity remain scarce.
The problem is timing.
Housing can remain depressed for years when borrowing costs stay high.
Berkshire has the luxury of waiting.
Its enormous balance sheet allows it to own cyclical businesses through downturns without needing immediate returns.
Individual investors may not have the same patience.
Lennar’s Low Valuation Reflects Real Risks
Lennar’s depressed share price does not mean the stock is automatically cheap.
Its trailing revenue has fallen.
Net income has dropped sharply.
StockAnalysis data showed Lennar’s trailing net income down about 51%, while earnings per share had fallen around 48%.
High mortgage rates could remain elevated longer than expected.
Home prices could weaken.
Incentives could continue squeezing margins.
Construction and labor costs could stay high.
And if unemployment rises materially, housing demand could deteriorate even further.
Berkshire’s investment therefore represents confidence in a recovery that may take time.
But Berkshire Has One Major Advantage: Time
That may be the whole point.
Most public investors focus heavily on what Lennar earns next quarter.
Berkshire can think in years.
If mortgage rates eventually normalize and household formation continues, homebuilders could emerge from the downturn with significant pricing and volume upside.
Berkshire would then own a major Lennar stake acquired during the period when housing sentiment was at its weakest.
That is precisely the kind of setup Berkshire has historically preferred.
The Slower Buying Is Now the Signal to Watch
The headline is no longer simply that Berkshire likes Lennar.
That is obvious.
It owns more than 26 million shares.
The question is what happens next.
If Berkshire resumes aggressive purchases, its ownership percentage could continue rising quickly.
If buying stops around 11%, that may suggest Berkshire has reached its desired position.
And if the conglomerate eventually pushes toward 20% or higher, takeover speculation would almost certainly intensify.
For now, the filings reveal a more subtle message.
Berkshire is still betting on a housing recovery — but after aggressively buying into Lennar’s collapse, it appears to be becoming more selective about how much more it wants to own.
