Hey Homeowner: Are You Ready To Downsize?

Karin Carr, Owner
Published on November 14, 2022

There are some important decisions to be taken in order to ensure that you get the most out of this process, whether you’re bringing children into the world, kicking them out of the house, or simply reevaluating your financial situation.

As fate would have it, these choices cannot be avoided. Downsizing and upgrading will always take place. Younger folks with children will inevitably uproot and take on a greater mortgage. Then, as people enter retirement, they will inevitably move into a smaller home.

There are a number of reasons you might be downsizing. While retirement is the most frequent option, the current era has introduced new variations, one of which is an increase in mortgage burden.

You might think of remodeling the family home if your finances are secure and you want more space to spread out and raise your children.

You must be appropriately ready for the problems that downsizing can present, regardless of where you are in life.

What advice do you have for downsizing a house?

There are many questions about home downsizing, so here are some suggestions:

  • If at all possible, pick a place that is close to where your kids and friends reside.
  • Make sure you have enough space by checking the closet and storage space in smaller homes.
  • Apartment life includes communal entryways such as parking spaces, hallways, and elevators. Make sure you are aware of the restrictions on “shared property” as it takes some time to get used to living somewhere other than a residential home.
  • Before buying your ideal downsize apartment, you might want to research the body’s corporate guidelines and, frequently, monthly minimum fees that apply to apartment towers.
  • Think about adding a spare room that can serve as a part-time study, reading space, or bedroom when friends, visitors, kids, and grandchildren are over.
  • Consider only homes with at least one downstairs bedroom and bathroom when downsizing for retirement so that stairs won’t become an issue and force you to move again.

The price of downsizing

While downsizing can increase the amount of money available for your regular bills, relocating to a unit or a strata complex might wind up reducing this financial flexibility once more.

In actuality, association fees for a basic 12-unit building without a lift and other luxuries can run as much as $500 per quarter. You are exempt from paying this $500 if you rent a separate residence.

If you’re not generating much money from your sale, the extra $500 every quarter – or $120 a month – might be devastating. The expense of listing your property and buying a new one can amount to up to 15% of the purchase cost.

These costs can increase even more if you have your sights set on a retirement community or over-55s development.

Hey Homeowner: Are You Ready To Downsize?

What advantages come with downsizing?

  • Mortgage payment decrease or cancellation – Downsizing can significantly lower your monthly mortgage payments, depending on where you decide to purchase your new home. Smaller homes have lower operating costs, which frees up cash flow and results in significant interest savings over the course of your mortgage.
  • Greater nest egg: With the money, you save on your mortgage, increase your retirement savings.
  • Travel with more freedom and see more of the world! You’ll have a more manageable home base that’s simpler to keep up between excursions if you downsize.
  • Less expensive utilities – Lower costs for electricity, gas, heating, and cooling
  • More free time – Downsizing gives you more freedom to explore and revisit interests and activities you may not have had time for when you were busy caring for gardens and a larger home.
  • Lower maintenance costs – By choosing an apartment or townhouse, you’ll significantly lessen your workload.
  • Peace of mind — Fewer possessions and less or no debt will result in a calmer state of mind and allow you to enjoy a new, streamlined home and way of life.

Make it easy on yourself

Downsizing doesn’t have to be a marathon event. Start slowly by tackling one room, or even one part of a room, at a time. Different variations of this theme include starting with your DVD collection, and paperwork or beginning in a room that doesn’t hold items of sentimental value, such as the kitchen – the junk drawer specifically.

One of the initial steps to getting a home ready to sell involves de-cluttering, which may require making some tough decisions.

Think of the first steps in downsizing as de-cluttering on steroids and yourself as a multi-tasking ace as you start this process.

First, make decisions about what you will take with you to the new home and what you’ll part with. Items in the latter category require additional choices: will you give them away, sell them or trash them?

To effectively use the following tips requires having a good idea of how much space you’ll have in the new home. Try to compare the size of the rooms in your current home with those in a substantially smaller home to make it easier to determine how much of your current furniture can make the move with you.

Use large boxes, bins, or even designated floor space to separate your belongings in each room according to the decisions you’ve made about them. The giveaway items will need to be further categorized as to whom they will go, for instance, “kids,” “charity,” and “friends.”

When handling an item, ask yourself first, how important it is to you. If it’s a “must keep,” then you’re finished with that item and you can pack it. If not, ask yourself how it fits with your new lifestyle. “If you don’t entertain anymore, don’t bring a ton of serving platters to your new home,” Ann Bass, a senior move manager in Asheville, N.C. tells the Wall Street Journal.

There’s a lot to like about a more minimalist lifestyle. For some, the pursuit is liberating, for others it’s terrifying. If the thought of ditching your belongings and moving into a smaller space makes your heart beat quicken and your palms moist, don’t think of it as “downsizing,” suggests the National Association of Senior Move Managers. Instead, consider it “rightsizing.”

We hope you have found these tips for downsizing helpful, and we eagerly look forward to helping you enter the next exciting phase of your life.

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