Buffett has good news, however modest

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Warren Buffett told the people who attended the Berkshire Hathaway (BRK.A) annual meeting that the company's earnings for the most recent quarter were down some. The company had first-quarter operating earnings of $1.7 billion, down from $1.9 billion in the same quarter a year ago.

Tucked in among his long list of observations about the economy was a positive comment about real estate prices. According toThe Wall Street Journal, "In the last few months you've seen a real pickup in activity, although at much lower prices," Buffett said, citing data from Berkshire's real estate brokerage business, which is one of the largest in the U.S. In California, medium and lower priced homes -- under $750,000 -- have been selling more, although there hasn't been a bounce back in sale prices.

The question is whether the "improvements" are mostly in California, one of the hardest hit states in the nations, or, whether the same tiny improvement in demand is nationwide. Housing prices in some parts of the nation's largest state by population are down by more that 40 percent. At those kinds of discounts, some buyers are bound to move into the market.

Douglas A. McIntyre is an editor at 24/7 Wall St.

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