I sold my REIT position to fund a boiler and lost both ways

Small loss but a clean one, so it's worth writing down.

I had about 18k in a broad REIT fund, sitting there as the liquid part of my portfolio. The whole reason I chose a public REIT over anything private was liquidity. I could get to it fast if a building needed something.

In February the boiler in my four-unit failed. Replacement quoted at 11,400. I sold 12k of the REIT fund on a Tuesday, had cash on Thursday, boiler in the following week. The liquidity worked exactly as advertised.

Here's what I got wrong. I sold into a down market. The fund was off roughly 14 percent from where I'd bought most of it. So I turned a paper decline into a realized one on 12k, which is about 1,700 of loss I didn't need to take. And I have no plan to buy back in, because the operating account that should have covered the boiler is still thin, so the money is just gone from the sleeve.

The REIT position was doing the job of an emergency fund without being one. An emergency fund holds its value on the day you need it. A REIT fund holds whatever the market says that morning. I knew that in the abstract and I still let one account do two jobs.

What I'd do differently: keep a real cash reserve for the building sized to the biggest single system that could fail, and let the REIT sleeve be money I don't touch for years. Six months of operating expenses plus one boiler is not a hard number to work out, I just never wrote it down.