They're Not Making It Any More

Last week I had breakfast with a friend who was talking to me about his recent purchase of a house in Florida. He told me that, on the one hand, he couldn’t believe he now owned another piece of property which, as he said, he needs like a hole in the head. On the other hand, he made a comment I have heard and thought myself many times over the years : as the stock market swooned on Thursday he thought, at least I own some things which are real. The market can change, but they actually exist. If anything, he said he wished he owned MORE stuff.

That is of course the fundamental beauty of buying real estate, or art, or jewelry. It has two kinds of value. Clearly, one of those values is financial, and subject to market fluctuations just like a securities portfolio. But the other, greater, value is harder to define. Part of it is quality of life – few of us are soothed by our stocks per se the way we are by our home, or our grandmother’s engagement ring, or a beautiful drawing. Investing in something you can use and which is an expression of personal taste has a unique resonance. But there is more to it than that. The fact that these objects exist, that you can touch, or hold them, or look at them, makes them real to us in a way money, which just represents potential, never is.

I have had this discussion many times with customers over the years. Money in your pocket represents choices unmade, the lure of possibility. I think it is the loss of that sense of possibility which so often elicits buyer’s remorse. But in the end, a home is a great investment for the soul, regardless of its usually beneficial effect on the pocketbook. And the supply isn’t endless. As Mark Twain said, “Buy land. They’re not making it any more.””