As I see it, the best part about getting older is the wisdom that can come with it, if we are willing to spot the patterns that tie our words and actions to various outcomes, pleasant and unpleasant, and are willing to break those patterns when we notice them.
For instance, I have a pattern of taking up a workout and, because I love working out, just doing it to extremes, so many days in a row without rest that I inevitably end up injured and have to find an alternative regimen that I also take to extremes.
And I’ve started to notice this as a pattern as I hear myself say the same sorts of things to my friends and fitness pros as I discuss my situation. In fact, just this week, one of my fitness teachers staged an intervention to let me know I’d been overtraining and that I needed to let my body simply rest.
The same thing happens in real estate all the time, but because our time frames for executing real estate transactions are so long, it can be more difficult for a friend or adviser to help us spot and stop our dysfunctional patterns.
So, here are a few real estate patterns I’ve observed come up over and over in the buyers, sellers and homeowners I interact with, to help you spot your own. And if you do see yourself in any of these patterns, take heart and do what I did with my fitness fanaticism: Understand that the urge or emotion behind the pattern is not bad and might even be good — but prepare yourself to feel uncomfortable the next time the urge hits and you resist the knee-jerk reaction to buy or sell or refi or move while you run the numbers and engage the external feedback that can help you be sure you’re not allowing your emotions to make your real estate decisions for you.
1. Sell and move (and repeat, then repeat again) — just because you can. Selling and moving over and over just because you can is sort of like day trading — it’s a setup to lose out on something. In fact, just recently a loved one called me up to tell me with precision exactly what I should do: Sell my house, buy two neighboring condos and allocate one for my office. Then, I sketched out all the reasons I’m staying right where I am — chief among them, that my home is extremely well-located, comfortable and functional for me. And my neighborhood? Forget about it.
The bigger issue was that this relative is someone who has always moved every few years, perhaps inspired by that uber-American pioneer ethic, always conquering something newer and bigger, always moving on up, until the recession caught her upside-down, that is. So, she’s trying to exercise her agita and need to move by suggesting that I do what she would if she could.
Moving constantly just because you can — not because your home is really not working for you, or you need more space, or you have some want or need to be in a different geography — is a very expensive way to keep from being bored, when you take into account the closing costs and stresses of the transaction and the move. It also prevents you from planting deep roots in a neighborhood or a community, and from finding the hidden possibilities of your own home that simply take time to surface.
2. The "life would be perfect if I lived in that house" fallacy. This is what 12-step programs call the inclination to "pull a geographic," the idea that whatever life, relationship or other problems you have in one home or city will resolve themselves with a dramatic quickness if you simply move homes or towns.
My friend Meghan Daum wrote an entertaining book a few years back from which I’m borrowing the title of this fallacy, relating her experience growing up with a mother who took her to open houses even in cities where they didn’t live, even when they weren’t in the market for a home — and as an adult who fixated on this same fallacy.
Fact check No. 1: Life won’t be "perfect" anywhere, even if you lived in Spelling Manor or Mar-a-Lago. (OK, especially if you lived in Spelling Manor or Mar-a-Lago.)
Fact check No. 2: Life can be really, really great almost anywhere. The things that make or break our happiness in life are issues that we need to work on and resolve wherever we are — they are often driven by behavioral, relationship and other patterns and habits that will simply repeat in a new home or a new town, good or bad, unless and until we make a concerted, intentional change.
There’s nothing wrong at all with fantasizing about your dream life in a dream homes, unless it gets to a point where you are discontent with your own life and home and start to actually believe that a simple move will fix it all. Of course, if your big issue is that your children don’t have space to play outdoors or your home is just too big of a fixer or too expensive for your realistic financial plans, then moving might help — just don’t expect perfection.
3. Refi on repeat. Obviously, refinancing can be a smart tool for fixing what’s broken about your mortgage, taking advantage of market changes in interest rates to reduce your mortgage payments and even paying your home off faster, as many smart homeowners use refis to do by either using the freed-up cash to pay off their principal loan balance early or by actually refinancing from a 30-year to a 10- or 15-year loan.
But there are some homeowners who don’t just use this tool, they abuse it, as a means to continue living above their means or fund risky financial moves. And on the other end of the spectrum are those uber-frugal folks among us who are fixated on interest rates and just feel a fear of missing out on even the most incremental decline in interest rates.
Refis often (not always) cost money, and also often (not always) extend the time it will take to pay off your home. So they should not be done lightly or as a tic just because it’ll possibly save you $50 per month.
Resist the urge to engage in this pattern and instead engage financial planners, mortgage planers and other pros who can help you make wise decisions about how to refi smartly and only very occasionally.