10 Secrets: An Introduction

It is our choices…that show what we really are, far more than our abilities.
—J.K. Rowling

A secret is something hidden or known only to insiders. A few behavioral scientists and market researchers might be acquainted with some of the ideas in this blog series, but these concepts have not been available to consumers prior to now. One of my professional priorities is to change that fact by equipping homeowners, renters, buyers, and sellers with “insider information” that can help them become more comfortable (and savvy) about whatever housing transaction they might contemplate.

Housing decisions are crucial. They can involve the most money you ever spend, the highest debt you ever incur, and the best (or worst) investment you ever make. A moving decision can result in either a frustrating or fulfilling experience that affects not just your life, but the lives of loved ones who move with you. Yet, as my brother Adam recently observed, buying and selling houses is one of the few businesses in which the principals (and their stewards) on both sides can be rank amateurs.  They get caught up in emotions that rarely benefit the housing negotiations and, on occasion, trap them into making poor housing decisions. Renters also make poor housing choices and some renters’ decisions spoil their chances for future home ownership.

Whether you're a buyer, seller, renter, or one who is thinking about remodeling, refinancing, or investing in a second home, you can learn a new way to make housing decisions that go smoothly and enrich your personal life and your relationships while enhancing your enjoyment of the place you call “home.” In addition, you can increase your net worth at the same time. With a little curiosity, inner preparation, and practical guidance about decision making, you can approach your next real estate transaction with new confidence. The discomfort you might have about finances, the markets, or the uncertainty of making the right choice diminishes dramatically when you learn and keep in mind the following 10 secrets of successfully buying, selling, renting or investing in real estate:

• Secret 1: Your housing choices are not only about finances. In fact, they are not just about housing. They are about every aspect of your life.

• Secret 2: You have a housing history that influences your housing decisions today and it is key to understanding your housing emotions.

• Secret 3: You have a Housing Value System that consists of your housing history and housing profile. Your Housing Value System drives your housing decisions.

• Secret 4: Your partner (child, mother, or father) has a Housing Value System too, and it is as important as yours when it comes to making housing decisions.

• Secret 5: You can turn your Housing Value System into a decision tool that can help you make your best housing decisions.

• Secret 6: Self-knowledge is personal power in all housingrelated transactions. Housing knowledge is financial power that can save you time, money, and grief.

• Secret 7: There is a U.S. Housing System that you must learn to navigate. It includes the agents, organizations, agencies, and regulators with whom you deal with in any housing transaction you undertake.

• Secret 8: Your fears can move with you. To move on, you must pack up your courage and make sound housing choices, even if you do not feel courageous.

• Secret 9: Your mortgage can be the most important financial tool in your investment toolbox. It can be your ticket to future financial security.

• Secret 10: Your Housing Value System lives as long as you do. When it is time to downsize, find a home in retirement, or help to choose housing for an older adult, these secrets will be as valid then as they are today.

The Power of Knowing Your Housing Psychology

As you explore and discover the power of the 10 Housing Secrets, which I discuss in detail throughout this blog series, you will develop your own personal housing psychology. These secrets allow you to sort through and tame your emotions, understand and deal with the stresses of others, and discuss your feelings openly with less discomfort. Most importantly, these secrets can help you become an all-around better financial decision maker in the process. My goal is to help skeptics and believers alike learn to access and harness the power of their housing psychology in pending and future housing searches, negotiations, decisions, and transactions.

I specifically want to help you:

• Make you aware of your housing emotions, so that you can interpret them and then use your new understanding to make better housing plans and decisions.

• Enhance your understanding of your partner’s and other family members’ housing emotions, so that you can minimize conflict during the stages involved in changing where and how you live.

• Learn that the best housing decisions incorporate desire, knowledge, and the ability to successfully navigate your emotions.

• Realize that wise housing choices have the potential to anchor your entire future financial security.

What Is Housing Psychology?

I define housing psychology as “a field of study that synthesizes humanplace interactions with finance.” It incorporates social psychology, which looks at our behavioral interchanges with others. It borrows from environmental psychology, which examines the roles of “place” in our lives and tries to understand our attachments to home.2 Almost all of our housing transactions have financial and economic effects, so the dynamics of housing psychology fall within the new and growing field of “behavioral finance.”

So how can knowing your housing psychology help you make good housing decisions today and in the future?

Any housing decision—buying, renting, selling, remodeling, or investing in a second home—combines significant financial and personal components and consequences. On average, the cost of renting or carrying mortgage payments sets most of us back each month from about 25 percent to as much as 50 percent of our income. Although finances are definitely a major factor, housing choices are not only about finances. In fact, they are not even just about housing. They involve our ideas, desires, longings, identities, beliefs, attitudes and all the other aspects of our unique personalities, as well as our relationships.

There are two parts to understanding your housing psychology: uncovering your housing history and becoming better acquainted with your housing desires and values. With the combination of this self-knowledge, you can create a personal decision context—call it your Housing Value System— for grappling with even your most difficult housing decisions. It is possible to compare notes and resolve disputes with a partner and/or other family members, so you can make shared housing choices without the emotional flare ups that can make moving so unpleasant.

Understanding your own inner signals and housing preferences, and those of your partner or family members, can help you make decisions you can trust and investment choices you can rely on better. Understanding your housing emotions also positively spills over into other important life areas because you learn how your past history influences your current decisions, especially financial decisions. These are some of the benefits you discover from the 10 Secrets to Successful Home Buying and Selling guide.

Learning from the Success and Mistakes of Others

Unlike learning from our own experiences, people are better at learning from the successes and mistakes of others. This blog series is based on extensive empirical research and on hundreds of case histories from interviews, consulting, presentations, and seminars.  The posts in this series are filled with the housing experiences of real people.

You will quickly learn the winning factors that you can apply to your own circumstances. The housing experiences and problems from actual case histories also illustrate how far-reaching housing decision problems are. Whether or not you are in the same situation as the people whose stories you read in this blog series, you can become better acquainted with yourself and recognize others you know as well.

You will feel more confident about any type of housing decision you face, even if you must make that decision only once or twice in your lifetime. You will be able to extend the money you have to spend on a house, help an older relative who must solve a housing dilemma, maximize your desirability to a mortgage lender, help a young adult move out of the nest, and deal with every aspect of a housing transaction with less stress and much more self-assurance.

Get the Most from the 10 Secrets to Successful Home Buying and Selling

Use this blog series in the way that works best for you: either as uninterrupted reading or as a guide for making a pending housing decision. Part 1, “Your Housing Psychology,” acquaints you with your unique housing psychology and the underlying reasons for the sometimes euphoric and sometimes painful housing emotions most of us have experienced in our lives. In my seminars on home and decision-making, I’ve seen people cry and watched others break through decision paralysis by “revisiting” homes of their past. And anyone who has ever “fallen in love” with a home knows the emotion that can accompany—and sometimes sabotage—their housing negotiations.

Posts 2–8 show you just how the non-financial areas of your life impact your finances to your benefit or your detriment, depending upon your Housing Value System and your approach to housing decision-making. Each reader must learn for himself or herself the underlying experiences and values that make up his or her own Housing Value System before moving on to compare notes with a loved one or another family member. 

Post 9, “When Housing Values Differ,” is especially helpful to couples and family members who make joint housing decisions. You and your partner should be able to compare and discuss your housing personalities and past experiences when informed by insight and a shared sense of purpose. No longer must you deal silently (or otherwise uncomfortably) with your housing differences. Instead, you can use the framework outlined in Posts 4–8 to better understand and more openly deal with individual issues that might remain unresolved.

Note: Throughout the blog series, I use “partner” to refer to spouses, significant others, and other housemates because a shared living arrangement in one way or another makes you partners. People who have shared the responsibilities of a home know the pit-of-the-stomach feeling that can accompany an unresolved housing problem with a live-in partner.

Part 2, “Finding Solutions That Work for You,” provides a variety of ideas and suggestions for how to use your Housing Value System to make housing choices and decisions. If you skip to your pending housing problem in Part 2, here is a decision tip at the outset: Return to the housing history and housing profile exercises in Posts 3, “Your Housing History,” and 4, “Creating Your Housing Profile,” and read through the analyses in Posts 5–8. The results of these exercises and elaborations form the core of a powerful system that can set you straight on the path to housing and financial security. You will clearly see how your unique housing history and housing profile are programmed right into your present lifestyle, relationships, and housing decisions.

Regardless of how you use this guide, if you apply its principles, you will never have to look at housing decisions with fear or anxiety again. Instead, you can take great pleasure in both your future decisions and your future moves. Choosing the right home at the right time can be a mystical experience. A bond can begin to form with the place you call “home,” whether you are renting or buying. When you buy your own home or trade up (or down) to that next home of your dreams, you will experience a feeling of well-being that extends far beyond the home itself.

Until next time ... feel comfortable sharing your own experiences, questions or concerns related to buying, selling or renting in the comments sections below.