Needs vs wants home buying: how to stay optimistic while finding your perfect home

A lavish living space might be what a home buyer dreams but practically is unavailable

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It’s easy to get wrapped up in the excitement of home buying. After all, it’s one of the biggest financial decisions you’ll ever make in your life. But it’s important to stay grounded and realistic during the process. Home buyers often come to me with this idea of their “dream home” in their heads. And that’s great! However, you may not always find everything you want in a house, so it’s important to evaluate what you need versus what you want in a home.

Your needs are essential for you to have in a home, while your wants are simply desires that you would like to have.

In this article, I’ll discuss the differences between needs and wants.

Needs vs. Wants: Home buying

When buying a home, needs and wants can quickly become blurred. It’s important to take a step back and evaluate what you need to be comfortable.

As a real estate agent, I help my clients identify their needs so that we can focus on finding the right house for them. The homebuying process can be long and frustrating, but if you know what your needs are, it’ll be much easier to stay optimistic while finding the perfect home.

Home buying needs

Your needs are non-negotiable, deal breakers that are essential for you to have in a home. For instance, if you have a large family, you may need a house with four bedrooms. Or you may need a home with an office if you work from home. In contrast, empty-nesters may need a home with fewer bedrooms and less maintenance.

Needs can also be things like:

  • How many bathrooms
  • How much square footage
  • A specific location

These can vary from person to person, but needs are things you can’t or don’t want to compromise on.

Sometimes, I notice my clients’ needs change as we go through the home buying process. They may come to me saying that they need a large amount of square footage. But after looking at a few houses, they realize that when thinking about their “dream home,” they didn’t consider the cost of maintaining that extra space, so they may adjust their need to save money.

Needs should not be flexible, so if you find you are easily compromising on your needs, then you need to move them to your wants list. You need to ask yourself: “what are the must-haves in my new home?”, “what can I compromise on?”, “What are my non-negotiables?”

Try to be as specific as possible when identifying your needs. This will help you and your real estate agent narrow down your search and find the perfect home for you.

Home buying wants

On the other hand, wants are features you would like to have in a home but are not essential. For most home buyers, a pool is an excellent example of a want. It’s something that would be nice to have, but it’s not necessary.

Some other examples of wants include:

  • A particular type of flooring
  • A specific style of home
  • Upgraded appliances

A want is not a deal breaker, so you can compromise on them if you need to. Real estate agents often help their clients identify their wants so that they can be realistic about what they’re looking for in a home.

I make it a point to ask my clients questions to help them identify their wants vs. needs. For instance, I might ask them: “Are you willing to compromise on the size of the house if it means that you’ll get a home with a pool?”, “If you hate carpet, do you need a home with hardwood floors, or would laminate suffice?”

I also review what is customary for houses within my home buyer’s budget to see what items on their want list are actually feasible. If your wants and needs aren’t possible within a certain price point, I would suggest speaking with a mortgage lender to understand what home loan options you have regarding your loan amount and loan type to get the most out of your purchase.

Discussing these issues with my clients helps to set expectations and manage their expectations throughout the home buying process.

Common needs in a home

As we’ve discussed, needs are items you can’t or don’t want to compromise on. I’ll briefly discuss the most common needs that I see in my clients so you can get an idea of what yours might be:

Location

This is probably the most common need that I see. Clients often have a specific location in mind for their new home. It could be near their workplace, within a specific school district, or in a particular city or town.

Try to evaluate your needs for a specific location before beginning your home search. This will help you and your real estate agent focus your search and have a clear reference when comparing homes. You can also begin visiting open houses to get an idea of what’s available in your desired location.

Size

Size or space is another common need that I see. Clients often need a certain number of bedrooms or bathrooms. They may also need a certain amount of square footage to accommodate their needs.

It’s essential to be realistic about the size needed for your new home. It’s also important to consider how the space will be used within a home. Do you need a large dining room and entryway for guests or do you only care about a large primary bedroom?

Budget

The first step in the homebuying process is to speak with a mortgage lender to make sure you are financially ready and have an adequate down payment saved for home buying. The mortgage pre-approval process will check your credit report, income and debts to determine how much you can afford. A set budget will help you narrow down your search and find homes within your price range.

Your mortgage pre-approval will tell you how much you can afford, but it doesn’t tell you how much house you can get with that amount. Before making your needs checklist, you should understand what is typically available within your price range to make sure the items on your wants vs. needs lists are actually feasible.

Common wants in a home

Now that we’ve discussed needs let’s talk about wants. As I mentioned before, wants are items you would like to have in a home but are not essential.

Here are the most common wants that my clients have:

Amenities

Some examples of amenities include a pool, a spa, or a sauna. These are great features to have in a home, but are they necessary?

If you have enough wiggle room in your budget, you may find a home with one or more of these amenities, but they are not standard in most houses. You may need to compromise on other features if you want a home with amenities.

The purchase price isn’t the only thing you need to consider when budgeting for a home with amenities. You’ll also need to factor in the cost of maintaining the amenity. For example, pools require regular cleaning and chemicals. This can add up quickly, so be sure to factor it into your budget.

House style

A ranch, colonial, contemporary, split-level, or a Mediterranean-style house? Sometimes, specific circumstances such as needing wheelchair access can affect whether a specific home style is a preference or a requirement. But most often, if you don’t need a single-level house, house style is determined by what styles are available within your budget.

You may want a 4,500 square foot center hall colonial, but your budget and the typical styles within your neighborhood of choice may force you to compromise with a contemporary style or expanded cape cod style with the same square footage and similar layout.

Interior home features

A limited purchase price may mean that you have to compromise on the interior upgrades within a house. However, there are ways to update the style of a home to better suit your needs.

Adding your personal touch by painting the walls, updating the fixtures, or changing the flooring are relatively inexpensive changes that can make a big difference in the overall style in a home.

Now that we’ve discussed needs and wants, it’s time to make your list.

Questions to ask yourself when making your needs and wants list

What are the must-haves that I absolutely cannot compromise on? Look at the needs discussed above and add any others vital to you. List your needs in order of importance. If you are starting a family, a home with four bedrooms in a certain location may be at the top of your list. Meanwhile, a smaller home may be more important to you if you are downsizing.

How much can I afford to spend on a new home? This is an important question to answer before starting your search. You don’t want to fall in love with a home you cannot afford. Find out what is typically available within your price range, and stick with those options when considering your wants vs. needs.

Do I have enough budget for other essential needs? Once you’ve determined your budget for a new home, it’s necessary to factor in other costs like closing costs, the home inspection, home appraisal, property taxes, and moving expenses. Don’t forget homeowners insurance and any necessary repairs or renovations. These costs can add up quickly, so be sure to factor them in before making a purchase offer on a home.

Bottom line

By distinguishing your needs from your wants, you can stay within your budget and remain optimistic while searching for your perfect home.

Don’t hesitate to reach out if you have any questions about this process or need help getting started. I’m always happy to help!

Author

Cristina Morizio

Long Island real estate agent Cristina Morizo
As an experienced REALTOR® and Long Island native, I know the ins and outs of the real estate market. I help home buyers, sellers, investors and homeowners navigate and negotiate. Questions? Ready to buy or sell? Let’s talk!

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