Why Facebook's Billionaire Founder Rents

What kind of a billionaire tech genius rents? Apparently the Mark Zuckerberg kind. So when recent news hit that Facebook founder and "The Social Network" subject Zuckerberg rents a month-to-month apartment in Palo Alto, Calif. many observers were puzzled.

After all, Bill Gates paid over $1 million just in 2009 property taxes for his Washington State home valued at over $140 million. Oracle CEO Larry Ellison famously shoveled over a reported $65 million for five lots in Malibu's Carbon Beach in 2005 -- and that was on top of the $200-million Japanese-inspired home in Woodside, Calif. that he built. And then there's the recent news of movement in Steve Jobs' 10-year battle to build his dream home, also in Woodside, that will cost many, many millions.

So why does this young tech tycoon rent?
News of Zuckerberg's rental status hit the headlines as part of a legal battle with a man who claims that he is entitled to 84 percent of Facebook, Inc. At issue in the case is Zuckerberg's status as a renter in California, which lawyers are using to say that his true home is in New York State -- which means the case would be tried there.

"He was living the same sort of existence the evidence shows now, a sort of
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duffel bag, apartment-to-apartment, transient life," is how attorney James Grable argued for his client. Zuckerberg's attorneys are calling the lawsuit and claims a "fraud."

But it started the talk: a billionaire renting?! All of a sudden, the way millions of Americans live is being frowned upon in this case and used to show a careless, reckless lifestyle. I mean, a billionaire renting?!

A look back shows that Zuckerberg's status as a renter is hardly news. In a January 2008 interview with "60 Minutes," Zuckerberg told Lesley Stahl that he lived in a one-bedroom apartment that he rented and "didn't buy expensive clothes." He said that his company wasn't that big. These days, he reportedly drives a basic Infiniti sedan, so as not to draw attention to himself.

While most tech wizards might take their riches and buy homes, Zuckerberg's "normal" life (by standards for a 26-year-old) seems to baffle lawyers in this case and many observers. The simple answer for Zuckerberg's unencumbered lifestyle may be that he is not motivated by material possessions. And since much of his fortune is on paper, he could be playing things safe.

Still, some realty professionals remain surprised.

"It's unusual," says Bob Gerlach, vice president and manager of Alain Pinel Realtors in the Silicon Valley community of Palo Alto. "Most tech guys do well and buy a nice property. One of the first things someone does is buy real estate.

"I think everyone wants to be a homeowner," he says. "Sure, we have execs who move in and rent for a year and decide what to buy after getting to know the area. But most people invest in real estate, especially in high-end."

In Stahl's report, Zuckerberg's Facebook was said to offer employees free food and laundry -- not the normal company perks. And with his rental status, Zuckerberg is proving he is not the normal billionaire.

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