FIRST TIME BUYER: BALANCING NEEDS AND WANTS IN YOUR NEW HOME

Now things start to get exciting! You have your pre-approval (in writing) from your bank or mortgage broker, and you’ve found a great Real Estate Agent to work with – it’s time to start the search for your dream home!

For prospective home buyers that come to me and ask to go out looking at homes, I would first want to clarify two things:

1. What do you “want” in a house?
2. What do you “need” in a house?

If you’re planning to buy a home, the most helpful advice I can give you is to be prepared to distinguish your needs from your wants so that you can be confident about which homes you want to make offers on when the time comes.

START WITH YOUR DREAM HOME

Envision your ideal home. Does it have a large plot of land for your children to play? Or is it a high rise condo in the Ice District overlooking the city lights? Where is your ideal home and what makes it unique to you? If you are unsure about what is reasonable or not within your price range, this is where your agent comes in. One of the primary roles of a Real Estate Agent is to know the area, know what homes are going for, and about how much added features – like an additional bedroom or pool should add to the price.

THEN WORK BACKWARDS

As you put together the picture of your dream home, you may find that there are particular features you don’t want to sacrifice, and for some of those features, you would be willing to pay more. Maybe it is living close to work; it could be open concept living, a finished basement, a large backyard or even something less common like wheelchair access for a friend or family member.

Sometimes, the wants are easy to distinguish from the needs because you will find yourself saying, “a corner lot might be nice.” But look at it this way, wants are things that you can add or change on your own.

For example, maybe like me you are a huge Edmonton Oilers fan and want a home with a basement you can turn into an Oilers Fan cave. Blue and Orange walls, space to hang and showcase memorabilia. So you view a house with a finished basement, it’s got good potential but would need a small amount of elbow grease to turn it into your fan cave dream. With a little effort, it’s easy to fulfill this want once you’ve moved in.

In some cases, buyers don’t want even to consider any elbow grease working on their home themselves but trust me, finding a great house at a reasonable price is infinitely more manageable when you are flexible on wants.

FOCUS ON “VALUE ITEMS”

In real estate, a valuable item is a feature that adds value to the property for future buyers.

When evaluating your needs and wants, it’s a good idea to consider value items with more weight than things that are of personal preference but add little value.

Items that add value include triple-pane windows, granite countertops, hardwood floors, land, professionally landscaped yard, a beautiful view, or a top-rated school district. Your real estate agent will be able to help you determine the difference between a valuable feature and a personal touch.

Of course, some significant features don’t always add value. For example: in Edmonton does a pool add value? Probably not, it is expensive to maintain; you can only use it three months out of the year, it needs to be winterized, it may be perceived as a negative in this market.

Anything too personal may lack value in terms of resale or even subtract from it. You may fall in love with the massive mural that the current homeowners painted in their child’s room after all your son loves Spiderman too! Just keep in mind that when you go to sell, someone will want to paint over it and they will count the cost of repainting when they consider what they are willing to pay for the home.

Things that add value are generally thought of as beautiful, safe or convenient by the majority of people. Things with no value are unique to you for the reason that other people might not understand or want.

As you prepare to buy a home, remember that no home is perfect. You will always end up making compromises, but with a good understanding of what’s most important to you, what you can live without and what will add value to the home, finding the right home will be more natural.

USE A NEEDS – WANTS CHECKLIST

Whether you are single and buying on your own, or are a couple or a family, I feel it is essential for each buyer to individually complete a needs-wants checklist. This helps me to understand the needs and wants of each buyer. Sometimes you think you are on the same page as your spouse when it comes to needs and wants, but once the home buying checklists are complete you find that you have ranked your needs and wants on a very different scale, and allows me to discuss these differences with you before you begin looking at homes.

This checklist also allows you to think about what you need vs what you want in your new home,  and which is important to you in your dream home.

You can download a copy of my Buyers Needs – Wants Checklist here.