Whether it is to save monthly costs, inject some of your property equity into a retirement investment, live in a more manageable space – or to finally shift your 28-year-old gamer out the house, downsizing is a big decision most property owners have to make as some point.
Crispin Inglis, co-founder of PropertyFox, takes a look at some of the most important considerations when swopping a bigger home for a smaller one.
#1 Is it forever?
Decide if this is an interim downsize or potentially your ‘home for life’: If your kids have just left home but you are still working and living an active life it may be time to downsize but too early for a retirement village. In this case, look for a smaller home which is well placed near your work or near the things you enjoy doing so that you can cut down on time behind the wheel. This home should offer good security, be easy to maintain, have space for guests (but not enough space for the gamer to move back in) and allow you to pursue passion projects.
However, if you have stopped working and are starting to slow down a bit, it may be time to move into a retirement home. Retirement villages are ideal because they offer optimal security, as well as a ready-made community and health amenities like 24/hr health care and assisted living, should these become necessary.
#2 Pick a place that fits your budget
While pools and big gardens are lovely when the kids are still at home, they’re also very expensive to maintain. In fact, some studies have shown that middle-aged homeowners can spend up to half of their incomes on housing costs. If you’re after a simpler, more affordable way of life then you’ll need to decide which luxuries you can live without. A smaller home should ideally mean minimal maintenance fees, reduced levies and, potentially, reduced insurance premiums.
#3 Get serious
Take the property search very serious, this is one of the most important moves you’ll ever make so don’t rush it. Do very careful internet research to find an area with good resale value and high demand. And scrutinise costs associated with the property such as rates and levies to ensure it will remain affordable on a month-to-month basis into your future.
#4 Be smart
Weigh up all the options; you can save dramatically by listing through a low commission estate agent.
Before buying a property, consider whether it’s the best investment for you in terms of its predicted return-on-investment and any hidden costs involved. An investment adviser can prove valuable input in this process.
#5 Don’t feel the need to compromise on the big stuff
Be pragmatic about your needs. If you have hobbies, you’re going to need some space for your craft or if your family pops over frequently, you’ll need a nice entertainment space. You’ll probably want a place with no stairs, easy navigation between rooms and quick access to nearby amenities. As you get older, think about whether the house will be able to be tailored to meet your changing needs.
Practical tips for the downsize:
- Plan three months ahead for the move so you have plenty of time to pack up – there will be a lot less room in your new home so it may be necessary to make some tough decisions and let things go, which will take time.
- If you have duplicates of items as ‘back up’, give these away.
- If you need to part with special things, consider gifting them to friends and family.
- Donate less valuable items to welfare and consider auctioning higher value items for extra income.
- Remember, some of your bigger furnishings may not fit in a smaller space. Consider selling these to raise the money to buy new better-fitting furniture – and measure your new space carefully before making big decisions.
This is an emotional time, if giving away, selling or donating all of your most priced and sentimental possessions might seem impossible. Remember that you could also consider storage to give yourself more time. Read more on what to expect when downsizing and how to prepare yourself emotionally.