Kevin O’Leary Says, Forget The Classic Three-Bedroom, 2,500 Square Foot For $1.2M—Now You’re Paying That For A Trailer Home In California
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Investor Kevin O'Leary, also known as “Mr. Wonderful” from the TV show “Shark Tank,” is speaking plainly about the state of housing in America. The entrepreneur and investor recently appeared on Fox Business and posted on X to share his unrestrained view on what's happening to real estate prices, especially in California, Texas and parts of Florida.
“There’s three issues now,” O’Leary said. “Obviously, mortgage is No. 1, it always has been in driving purchase [decision]. But there’s two other things that have come out of nowhere, particularly in places like California. They are insurance and taxes.”
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He explained that when you add rising insurance premiums and high local taxes to already steep mortgage rates, housing affordability takes a major hit. “Affordability is down about 40%,” he said. “In other words, you’ve got to buy a house with 40% less square footage and pay the same amount on it.”
For many, that means the days of buying a standard family home are over. O’Leary painted a stark picture: “That means that classic three-bedroom, 2,500 square foot deal that you could pick up for $1.2 million, forget about it. You’re living in a trailer home now for the same price it cost in California.”
“That’s a big part of the market,” he added. “Same issues in Texas, same issues in certain parts of Florida. I watch this like a hawk because I’m a big real estate investor. It’s ground to a halt while these issues resolve.”
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In California specifically, he blamed the growing insurance crisis. “I mean, literally, if it isn’t earthquake, it’s flooding. Now you got fire. You get fried, drowned, and shaken there, and nobody wants to actually insure that.”
O’Leary's concerns reflect a broader frustration shared by many potential homebuyers and investors. With insurance companies pulling out of high-risk states and taxes remaining high, affordability is dropping even further for average families.
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