This sounds like some type of cognitive bias. Probably Loss Aversion. Maybe Anchoring or Framing.
What is the value of the property? Well, whatever the market value is today. Does it matter what the persevered value was when the loan was taken out. No. Does prior movements make any difference? Will the market mean revert? Probably not.
Handling cognitive bias is hard, even for professionals. Here are some suggestions.
The first is to take out a clean sheet of paper, figure out what the value is, and if it is a good fit for your goals and risk tolerance. This may require you to write up a Investment Policy Statement. What you paid has nothing to do with it.
For fun, read "Thinking Fast, Thinking Slow" or "Blink: The Power of Thinking Without Thinking". These are great general purpose books. What may be a bit more on point is Quit: The Power of Knowing When to Walk Away by Annie Duke. All of her books are great but I think this one will give you more insight.
What is the value of the property? Well, whatever the market value is today. Does it matter what the persevered value was when the loan was taken out. No. Does prior movements make any difference? Will the market mean revert? Probably not.
Handling cognitive bias is hard, even for professionals. Here are some suggestions.
The first is to take out a clean sheet of paper, figure out what the value is, and if it is a good fit for your goals and risk tolerance. This may require you to write up a Investment Policy Statement. What you paid has nothing to do with it.
For fun, read "Thinking Fast, Thinking Slow" or "Blink: The Power of Thinking Without Thinking". These are great general purpose books. What may be a bit more on point is Quit: The Power of Knowing When to Walk Away by Annie Duke. All of her books are great but I think this one will give you more insight.
Statistics: Posted by alex_686 — Fri Jan 24, 2025 6:39 pm