Here’s an interesting take on buyers and sellers, courtesy of a recent article in The Wall Street Journal. What you look for, what you buy, and why you make the real estate decisions you do may reflect your personality traits. In fact, you may want to look at more than your credit scores and mortgage rates when you’re making that all-important decision: to buy or not to buy. You may want to think of the kind of person you are before signing on the dotted line.
According to a study published in the Journal of Behavioral and Experimental Economics, common personality traits can be linked to the kinds of decisions you make about mortgages, home ownership, and investments.
Researchers at Tel Aviv University and Technion-Israel Institute of Technology asked participants to take a standard personality quiz focused on qualities like openness, conscientiousness, agreeableness, extroversion, and neuroticism.
Participants were then asked five questions about real estate, including their preferences for the type and length of a mortgage, whether they were more likely to rent or buy, and whether they were more likely to invest in stocks or in real estate. The controlled study adjusted for variables such as age, gender, and income level.
Agreeable and extroverted people- those who get along well with others-were more likely to invest in real estate than in stocks. Neurotic people were more likely to buy than rent. Those who scored high on openness preferred smaller mortgages. And conscientious test-takers were more likely to have fixed-rate mortgages.
How does it work in real life? One blogger, Patrick.net, felt that the correlation between personality traits and real estate decisions worked for him: “Seems accurate for me: conscientious, not neurotic, open, not extrovert, and tend to prefer fixed, no rush to buy, prefer small loan over big house, prefer stocks over real estate (because stocks have better return).”