by John Miro
Many of you know that my family is selling our home and moving because I found a new job. It's been almost two months since the house was listed, and I must admit that it feels like our house will never sell.
We sold our first house in 2008 when all the housing mess was going on, and maybe I'm repressing memories, but it seems like it was easier to sell then. Granted, there was a homebuyer tax credit for first time buyers back then. We were also selling a home within the price range of a first time buyer, so that probably explains much of the difference.
I also read a recent article that said despite overall progress, sales of existing homes are slightly down. The article said also that sales of expensive homes were increasing. What I take from that is a lesson that if you try to play around in the middle, you will get lost in the sea that is the middle. Our house is not priced low enough for a young family, yet it is not expensive enough for the upper middle aged couple looking to expand.
One thing I learned from the housing crisis and the ensuing actions by the US federal government and treasury department: the rich get bailouts, the poor get handouts, and the middle class gets left out.
For those that play around in the middle, and by that I mean live a middle class life, it is tough to get ahead. Hell, it tough to get even, to get back to zero. When we paid off our debt last year, sending the final check on the same day we boarded a plane for two weeks in the sunny Adriatic, it was hard not to experience a variety of emotions. The first was jubilation for being debt free (minus the house) for the first time since graduating high school. That joy quickly turned to “oh shit I don't have any money saved!” I thought about the two paid-for vehicles back in our garage, and instead of pride I felt fear of what would happen if one just died. A vehicle is a debt, even when it's paid off, and as I recently wrote, having one can be an intangible asset in our lives, especially if we live in a place with no mass transit options.
So, back to our home selling issue.
We are having a few problems:
- The home is at the higher end of the price spectrum for the neighborhood. It is move-in ready and except for eventually needing to replace the driveway, but there isn't much needed to do to it. This means there isn't much room to get your money back on improvements.
- It has a small, crappy yard. We were never dog owners and prefer public parks and fields to backyard activities. We are finding that many people will sacrifice their own comfort (buy a smaller house, etc), if it means more yard for their dog or children. This is something I don't quite understand, yet I acknowledge that it exists.
- Uncertainty. This means I don't know why the ‘eff it isn't selling, and maybe the answer is uncertainty. Maybe there is something about the house we can't see that makes people hesitant or uninterested?
Despite our lack of progress, we get mainly positive feedback. Positive, yet hesitant. “The house was great, yard not so much.” “House was great but wants the storage of a traditional basement” (Our home is a split level with tons of closet space. I take this to mean that these folks are weird hoarders who hang out in musty basements).
Stay Positive, “It's Only Money”
Despite all this concern, I am staying positive. We haven't even hit the Average Days On Market yet, and after all, it's only money.
We are not underwater on the home and in fact, can lower the price quite a bit and still break even. We aren't facing the problems many have every day, and for that I'm grateful.
Which brings me back to the point of the middle class – if you can't have wealth, you might as well have fun. Now this could sound like excuse-making for those who spend wildly and rack up debt, and for many it is. I heard it before: “you can't take it with you.”
Those who say that are right.
But it is also right to take responsibility for your life, pay off your credit cards and stop living like a drone for Procter and Gamble and Toyota. Take some time to make a monthly budget. Take some time to think ahead. If you change your expectations, can you retire early?
If I do some research, will I stop repeating the retirement garbage from the retirement-for-profit industry that tells you that you need multiple millions in your bank and coupled with a modest return rate and the right choices, you can die in twenty years with…almost exactly what you retired with?
What fun is that?
We buckled down for quite a few years and made a lot of sacrifices, but that was to get to a point where the problem of selling a home is not a crisis. Even if it doesn't sell, I can attempt to rent it and cover expenses. I have enough cash saved up to pay on it for over a year before it becomes empty.
This is what financial freedom means. The ability to take a job and move on a whim, and not be tied to a job or a city because of money. The ability to work only when needed.
A wise man once told me: “It's only money. You can always get more money.” I think that is some of the best advice I've ever heard, but it's easier spoken by someone who has it. It does remind us of those times when we have it, and those times when we don't. Sometimes life just rains on you and thousands of dollars are sucked out of your bank account for car repairs and broken furnaces.
But if you develop a philosophy of money that allows you to question the rules and motives of those making the rules, you can break free from money and it's power of people.
Because when that older, wiser man was giving me that advice, it was in response to a story I told him about the mayor of our city killing himself because he squandered nearly a million dollars from his dead aunt's estate, money that was supposed to go to a religious charity.
“You can always get more money,” he replied, shaking his head.
If you are living in America or Canada or Europe, you can probably always get more money. Our social safety net is not going to let you starve if you are a normal person down on your luck. That gives us the freedom to take risks with our money, or the comfort to punch a clock from 9-5 and retire without a great deal of needs.
If you think of life as a game, it's more fun. If you play your cards right, you will probably get a great deal of 1-Ups and Respawns, but you will also get kicked in the junk quite a few times as well.
Make sure you take a moment to live your life. Take your vacation days every year. Reclaim your lunch hour. Sit in the sun and leave your smartphone inside on the desk.
Save money in advance for large purchases. Pay ahead of your credit card statement. Start thinking five years ahead, and stop thinking about your next paycheck.
Life is a game. Money is a game. But it's a game where you can decide when you've won, so don't set the goalposts too far or you'll wake up one day like Ebenezer Scrooge, too frail to wheel yourself onto a filthy cruise ship for that vacation you never took. Set a savings goal, and once you get there, relax.