It's safe to say that homeowners don't usually daydream about buying a smaller home. But there are some advantages to living in a smaller space, such as minimal maintenance and more time and money to spend on fun things. That's why some people see downsizing as a step forward, not a step backwards. If you're worried about having less space, you're not alone.
After all, an adult who usually goes to college isn't too close, but what about a son or daughter (or even another family member) who might need to move home for other reasons? When looking for a new home, make sure it meets your physical and emotional needs, as well as your financial needs. Just because you can find a bargain doesn't mean the house is worth it. After all, if you're going to make the effort to move, you have to do it right. Reducing the size of your home has many advantages.
First of all, if you've been in your current home for a while, it's likely that its value has increased and that you're close to paying off your mortgage, if you haven't paid it in full. Buying a smaller, cheaper property will give you a lot of leftover capital, to use for whatever you want. It also means that you can buy your new home as a cash buyer, giving you more options, a faster chain and the ability to live without mortgages. Reducing to a smaller home means less maintenance, lower bills and more time to do the things you love.
It's an exercise to save money and time. If you're going to reduce your staff in the future, it means you can choose a property that better meets your needs as you age. Rather than having to deal with stairs, limited accessibility, or a huge garden that requires maintenance, you can choose a property that works for you. If done right, downsizing may still be a good idea.
Not only will you be left with more money, but it may also simplify your life and reduce your home's maintenance and utility costs for years to come. To achieve that happy outcome, however, it's important to avoid the unexpected difficulties that make downsizing so risky. Here are four traps that await downsizers, with ways to avoid each of them. You should start the downsizing process as soon as possible to have time to properly tidy up your home without feeling overwhelmed. A general rule of thumb is that you'll want to start at least 3 months before you plan to move, but honestly, the sooner the better.
Unless you have the money to buy your new home directly, the reduction in staff may not be worth it financially. Mortgage rates have risen by more than 2.5 percentage points since the beginning of the year, and financing a home purchase is now significantly more expensive than it was a few months ago. You can also save money on maintenance and repairs with a smaller home, assuming you reduce its size to a property that is just as up-to-date and in just as good condition. Plus, you'll generally spend less to heat and cool a smaller home, so if you've had to deal with sky-high utility bills, downsizing could help you reduce them. If you can't remember the last time you entered your guest room except when it was dusted off, then it might be time to consider reducing your staff. There are many reasons why someone might want to buy a smaller home or reduce the size of their current one - from saving money on bills and maintenance costs to having more time for family activities - but sometimes the idea that less is more is what drives homeowners to buy a smaller home. Reducing yourself to a smaller house near your family will allow you to have lunch with your child or read to your grandchild while they go to sleep.
Reducing the size of your home may be a way to free up some additional money for retirement but make sure you analyze the numbers before packing up! The typical house that was hired in March was only 1,720 square feet according to a report by real estate agency Redfin; condos and townhomes are also becoming popular options for downsizers. When asked why they would want to buy a smaller home 69% of homeowners who had downsized in the past said that saving money was their main reason for doing so. Once you've done all this work to reduce the size and simplify your life, it's important not forget about maintaining this lifestyle - if you're working hard on getting out of debt reducing the size of your home is an excellent way of intensifying this effort! For example, refinancing your home instead of reducing its size entirely may be an option worth considering. With home prices rising by 19% in the last year alone downsizing may no longer be as affordable or cost-effective as it once was. If reducing staff due to divorce or change in financial circumstances is something that has been forced upon you then dealing with less space than usual can be frustrating.