Is downsizing right for you?
60% of people in a home measuring 2000 square feet or more express interest in downsizing.
As baby boomers reach retirement age, the idea of downsizing is increasingly popular. Is this a topic of conversation in your home? Are you empty nesters, or looking forward to retiring in the next five to ten years? Additionally, are you wanting to save money? Maybe you have feelings of wanderlust, leaving you longing to see new places and travel the world. Regardless of your reason, downsizing is a significant decision for your family. As a result, it is imperative that families weigh options and understand all potential outcomes of downsizing.
Generally speaking, many young couples buy their first homes with a future family in mind. Great school districts, more square footage, fenced in backyards, and friendly, safe neighborhoods are priorities for most married, first time home buyers. Three to four bedrooms are needed to raise a family, and a neighborhood pool and tennis club is a plus as well.
Fast forward twenty years and you find yourself an empty nester. There are unused rooms in your home. The cleaning is far more than you can keep up with. You’re (hopefully) approaching retirement within the next ten years. Downsizing to a smaller home is a reasonable option.
Additional Reasons to Downsize
In contrast, a smaller home may be a necessity, rather than a choice. Unemployment, long-term illness, or financial trouble can lead to moving to a smaller home, due to the decrease in utilities and monthly mortgage payment. Simply put, if your current property or real estate has increased in value while you were living there, view a smaller home as an investment decision. You could potentially sell your older home, gain access to equity, and purchase a smaller home with less maintenance and square footage.
Additionally, the maintenance, upkeep, and cleaning on a larger house is frequently overwhelming to homeowners, especially those who are not in physical tip top shape. The feeling of overwhelm sparks conversation amongst couples. Weigh the pros and cons of moving to determine if it is the best decision for yourself/family.
Certainly there are financial benefits to downsizing. Some benefits are more obvious than others. For example, downsizing is a known way to lower your monthly mortgage payment. It’s not, however, an option for everyone. This is often the primary reason why one may choose to sell their home for a smaller version. As noted previously, another financial benefit to downsizing would be to save money during a hard time (i.e. unemployment, long-term illness).
Less Obvious Financial Benefits
- A smaller home means a smaller utility bill (less power, less water).
- A smaller home means less maintenance.
- Due to the the reduced amount of space, decrease additional bills and fees like a cleaning service or yard service.
- A smaller living space allows for greater organization. Less purchases are necessary, particularly for replacement items, due to an increased amount of organization in a smaller space.
- For those that enjoy shopping for home decor, furniture, or other items, expect to decrease the amount of money spent. A small home is an easily decorated space, and storage is sparse. As a result, the desire to spend is kept to a minimum.
- Keep in mind that if you or a family member plans to sell the new home, a smaller, more affordable home is more appealing to a wider market, making the home easier to sell.
- In-demand neighborhoods are more affordable when purchasing a smaller home
Downsizing allows for more free time. Time that is spent doing the things you enjoy and love. Imagine if the hours spent vacuuming and dusting the house were cut in half. What would you do with the extra free time? Maybe you would spend it with your significant other. Perhaps you would like to pick up a new hobby.
- Less home maintenance and cleaning = more time for hobbies and family.
- In a smaller home, spend less time and money on maintenance and repairs.
- Empty Nesters? Spend more quality time with your spouse. ,
- Less space creates more time together. A cozy and comfortable living environment is essential for empty nesters.
- Reducing the amount of belongings and simplifying is mentally freeing.
- Smaller homes have less environmental impact.
- Optimize your space and maximize efficiency with less material items. Place a greater focus on family, friends, and your well-being.
- Some people are tempted when shopping for new things. Less space discourages keeping more items at home.
- Smaller homes are typically closer together than bigger homes. Neighbors that are physically closer are much easier to get to know and form friendships with.
Things to Consider
- It is easier to move while you still can, rather than when you are unable. Maybe you’re approaching retirement age, but in good mental and physical health. While in good health, take care of big decisions and physically demanding tasks.
- Does a smaller home fit your needs?
- What will you miss about your current home?
- Does size matter to you? To some, size of home is important. Be honest with yourself, before making a decision that could leave you unhappy.
- Will you have cost of living changes? Take into account the area you may look to move to. Are there neighborhood dues or HOA fees? Will you drive more or less?
- How much space do you truly need? Allow yourself to be honest. Can’t live without certain large items or things that take up a significant amount of room? You may not be ready to downsize, or it may not be best for you.
- If you currently live in an average home, is the home you will downsize to a big enough cost difference to be worth it?
- Price decrease vs. Market increase.
Before you Downsize
In summary, here are a few suggestions for you to keep in mind or take care of, prior to downsizing.
- Have a plan for sentimental items or items that carry a significant and special memory.
- Declutter early- before you pack and before you stage your home to sell
- Measure your favorite pieces of furniture and belongings – write the measurements down and keep them handy when searching for a new home
- Does downsizing fit your lifestyle or needs?
- Toss or sell unused items-a great way to gain extra cash.
Check out our post “Finding Clarity: Simplifying and Decluttering Your Life”. This article gives tips for decluttering, an essential part of downsizing.
Lastly, when thinking of downsizing, and determining what is best for you and your family, refer to this article for tips. Whether you’re downsizing or looking for something with a little more space, let us know if we can assist you on your next realty adventure!