What You Need To Know If You're Moving Into a Smaller Home
What You Need To Know If You're Moving Into a Smaller Home.
People downsize for a variety of reasons and they don't all face the same challenges. Before we go into what challenges you may encounter when you move into somewhere with less square footage, let's take a look at why some people sell a larger home for a smaller one.
Why do people move into smaller homes?
Kids moved out.
If your kids moved out to go to college, home downsizing makes sense because the existing home may be far too big for maintenance. The extra space is not particularly useful and you can save money on housing costs when you downsize your home.
Daily life becomes easier to manage, the lower utility bills are nice, and a smaller house is infinitely easier to clean. When selling a large house you also get more money to spend on you and your spouse.
Financial situation.
Just as we have hinted at just above, the extra cash from downsizing your home can be critical in gaining control of your finances again. Whether it's to get out of an unaffordable mortgage or to pay off credit card debt, downsizing can give you a financial boost - and that's something worth considering.
Though it can be demoralizing to move into smaller spaces, being stress-free about excess debt can more than make up for it.
Better location.
A larger house in a bad location isn't the same thing as a new space on the smaller end but in the right location.
The new location can get you closer to parks or schools, or make a big difference in your commute. Downsizing to a new home doesn't necessarily mean a downgrade in your standard of living, it can mean that the moving expenses allow you to enjoy a new neighbourhood that's more in line with your preferences and lifestyle.
Life circumstances.
If you received an undeniably great opportunity for your career and need to move then your home-buying journey may lead you away from the big house lifestyle you're used to to a smaller space. But it's a smaller space that gets you closer to your professional dreams.
Another possible reason for moving into a smaller home is the death of a spouse or spousal separation. If your spouse has died, you're likely to want to move into a smaller house to avoid the memories and heartache. You can also do so to move closer to other family members to have a better support system. A smaller home means low maintenance most of the time and that is easier to deal with if you're otherwise feeling overwhelmed.
What do I do with my current furniture?
The whole process of moving into a new house is stressful enough but when you don't know what to do with storage space or if you'll have enough room for how much stuff you have then it can become even more stressful.
Sell it beforehand.
A yard sale, Etsy, or eBay are all possible options when you sell your furniture before the move. It's important to pick and choose what you're going to keep and what you will sell. Family heirlooms, for example, are must-haves in your new space.
Start decluttering and separate things out well in advance - you could even use the Konmari method of only keeping things that "spark joy". You'll be saving money on storage space and moving costs.
Store it.
A storage unit can be a valuable asset, especially if you're saving money by moving out of a big house and into a smaller home. It could be a great place to store duplicate items or rarely used things like ski or summer vacation equipment.
Donate it.
While selling is the fastest way to make money off of your items, donating items can be tax-deductible and you will be doing someone else a favour. Look for non-profit organizations like Goodwill or Salvation Army who would greatly appreciate any donations they receive.
The most important part is making sure that you've done something with the things that you won't use at all in your new place.
It can cost a lot less to move into a smaller home but it's important to prepare yourself for any costs upfront, even if they are relatively minor. Here are some of the most common moving costs involved in downsizing to a new home.
Recycle or trash it.
If you are moving when you have broken appliances or one room filled with hoarded miscellany, then this is the perfect time to get rid of the mess and leave it behind. Recycle what you can and trash the rest.
Keep moving costs in mind.
The most common expenses associated with moving are the costs of transportation and labour. Transportation costs can include the cost of hiring a moving company, the cost of renting a truck or trailer, and the cost of fuel. Labour costs can include the cost of hiring movers, friends and family who help with the move, or DIY labour. If you are bringing sentimental items, then make sure you know how much space these will take.
How downsizing affects your finances.
How downsizing affects home equity.
Home equity is the difference between what a home is worth and the amount of money still owed on it. In other words, it's the portion of a home that's considered owned outright. It can be used as collateral for loans and gives homeowners a cushion in case they need to sell their homes in a down market.
A smaller house does not necessarily mean that you'll be paying less per square foot for your home. It depends on the price of the house. Home equity is not so much a measure of 'how much house' but rather 'how much value'.
Still, most of the time, downsizing means that your home will be able to build less equity than a larger home. This can make it harder to buy a new home in the future if you rely on home equity to shoulder the costs. Alternatively, the savings you make by moving out of a large home temporarily can make up for the lower home equity of the smaller house.
Downsizing, in most cases, will bring down monthly mortgage payments, depending on how big of a percentage of income they were, to begin with. You may also have lower monthly utility bills since you are in a smaller house. Insurance costs can also decrease as well since less space means fewer possibilities for calamities.
How to make the best of the situation.
Downsizing can feel hard for most people but having a plan can make the transition easier. Here are some tips for making your move as painless as possible.
If you think selling it will be too hard, consider renting it out instead. Tenants in your new home may help you pay off your mortgage while also giving you rental income to offset monthly costs or contribute to retirement savings.
Talk to a real estate agent about your current home situation and what your plans are for the future. The professional help they offer can uncover a path for you to get back on the property ladder by using the savings you make from living in a smaller home for a spell.
On the other hand, if you moved into a smaller home to enjoy a new neighbourhood or to spend less time cleaning and more time living then be sure not to fall into your habits. Go out, indulge in some more social interaction, and spend some extra time with family.
View All Homes For Sale in Greater Vancouver >>>
About Search Home Listings
SearchHomeListings.ca has simplified the home buying and selling process by giving you superior tools with up-to-the-minute information including active homes for sale, sold homes, market reports, and a home valuation tool! We have a team of success managers on standby to support you with setting up your saved home search and agents ready to take you out on a tour. Tap into our industry experts from inspectors, to contractors to interior designers to provide you with the best prices and service possible. Everyone attached to our website has been rigorously vetted and is made up of caring, knowledgeable professionals that work tirelessly to help you to make your home buying experience as stress-free as possible. Contact us today to see how we can help!
Sites We Follow
Categories
Recent Posts
};