Applying Maslow’s Hierarchy of Needs to Real Estate

Applying Maslow’s Hierarchy of Needs to Real Estate


When people consider where to buy a home, they’re subconsciously processing Maslow’s hierarchy of needs. There are five needs in renowned American psychologist Abraham Maslow’s pyramid: 

1. Physiological needs. This tier relates to the ability to sleep, eat, hydrate, and clean yourself—the basic human needs every home must accommodate. 

2. Safety needs. People will live in a home that meets physiological needs, even if it's not safe. Notice that satisfying No. 1 is more important than satisfying No. 2; such is the pattern of the pyramid. 

3. Belongingness and love needs. Will people (wife, husband, kids, etc.) love me if I live in this home?

4. Esteem needs. Will people respect me if I live in this home? It’s one thing to accept someone, and another to respect someone. When we respect someone more, we’ll probably be going to pay more money for this prestigious home. 

5. Self-actualization. People who are self-actualized are very confident yet able to acknowledge and work on their flaws. Properties purchased by people in the fifth tier of Maslow’s hierarchy might include something like areal estate decision-making.  penthouse at Ikoyi.

Of course, trophy properties satisfy physiological and safety needs, and of course, they accommodate loved ones and elicit respect from others, but they also go a step further: they help fulfill a particular self-actualizing vision of the owner. They have a goal in mind for their life, and these high price point properties help them fulfill it. 

Using Maslow’s hierarchy of needs is an excellent tool to help analyze the decision making in the process of buying or Investing in Real Estate.

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