If you are thinking about downsizing your home you are not alone. When it comes to home size, 37% of homeowners wish they had a smaller home. For people in homes over 2,000 square feet, 60% say they will pick a smaller one if they move.
Deciding to downsize is not easy. You are leaving a home with memories and in the process have to get rid of possessions you have grown attached to.
Fifty-four percent of the world’s population resides in small houses. Living in a smaller home will increase the need to maximize your space in both decorating and storage.
Read on to learn if you are ready to downsize, the pros and cons of downsizing, and some downsizing home ideas.
Signs You Are Ready to Downsize
You have been thinking about downsizing, but aren’t sure if that is the right decision. If you are older, your adult children may or may not be supportive of you selling the home they grew up in.
Here are some signs you are ready to make the move:
- One or more rooms in your home are unused
- You are near retirement
- The real estate market is strong
- Home maintenance and yard work are overwhelming.
You may desire living closer to your grandchildren. Studies have found that children who have a close relationship with their grandparents experience less behavior and emotional problems
Downsizing Your Home: the Pros
In the United States, the average size of a house in 1950 was 983 square feet. By 1973 the average size of a home was 1,660 square feet, and by 2010 the average home was 2,400 feet. People now realize that large isn’t necessarily better and many now enjoy the benefits of downsizing.
There is less likely to be wasted space in a smaller home, making it more energy-efficient. Utility bills will be lower when you use less energy for heating and cooling.
A smaller home will also reduce your mortgage payment and property taxes, allowing additional money each month for you to spend on fun things. You may even have enough equity when selling your house to purchase your smaller home outright. You can also use that equity to boost your retirement investments or use the funds to travel.
Spend Less Time Cleaning
The average homeowner spends 2-4 hours each week cleaning their home. When you realize that homeowners spend about 12,896 hours cleaning their homes during the course of their lifetime, why wouldn’t you want to downsize?
When you have fewer and smaller rooms, cleaning is easier and faster. When the time you spend cleaning on a weekly basis goes from hours to minutes, you have a lot more time to spend on enjoyable activities.
Reduce Outside Maintenance
When you own a home there are always gardens to be maintained, shrubs to trim, and a lawn to mow. Then there are the other periodic chores such as cleaning out gutters, raking leaves, and snow removal.
When you move into a smaller home, it will likely also have a smaller yard, reducing the time needed for lawn maintenance. If you downsize into a condominium, you pay a fee to have these duties handled.
A Cozy, Intimate Feel
Large rooms in a home can sometimes feel overwhelming and cold. A small home brings everything closer together, providing a feeling of intimacy.
When downsizing you may find the furniture from your larger home looks too big in your new location. One trick is to purchase furniture pieces that have at least three functions. Items such as lift-top coffee tables, or a faux library with hidden storage that opens to become a table and chairs are prime examples of the options.
Unique and Neighborly
As homes get larger, they are set farther apart and have small or no front porches. They are also less likely to be within walking distance of the downtown area.
If you are downsizing due to retirement, you may not want to drive in later years. Homes set close to town will be more accessible to public transportation.
Smaller homes are also usually closer together with roomy front porches, allowing for a more neighborly setting.
Income From Downsizing
When downsizing to a smaller home, there will be many items that you will not have room for. Some items you may want to give to your adult children. Other possessions can easily be sold online, in a garage sale, or an estate sale.
Here are some additional ideas for selling items:
- Classified ads in the local newspaper
- Mercari—online sales
- eBay—online sales
- Craigslist—online sales in your local area
- Consignment shop
Depending on the number of items being sold, you may bring in a few hundred dollars or several thousand dollars.
If you have equity in your existing home, the profit from the sale may provide you with the opportunity to enjoy things that were out of reach before, including:
- Eliminate outstanding debt
- Learn a new hobby
- Purchase a new car, new appliances, new furniture
Reducing your monthly expenditures and enjoying the profits made from downsizing are key benefits to enjoying your new lifestyle.
Creative Organization and Decorating
When you have a smaller home there are not as many storage options. Using creative organization includes using space-saving ideas for everything from kitchen appliances to bathroom towels and books.
Look at your home and see where there is typically unused space. Look behind doors, narrow walls, and more. Learning to use available space more effectively can include adding shelves above a window or door, storage secrets for toilet paper and extra towels in the bathroom, or where to place dishes in the kitchen.
While downsizing is often seen as a positive financial move, it also has emotional benefits. Downsizing into a smaller home is the perfect way to move forward and start a new life.
Making a change to a home that is affordable can reduce stress, leading to a happier day-to-day lifestyle.
Downsizing Your Home: the Cons
While there are numerous benefits to downsizing, there also are a few negative aspects of the process you will want to consider.
Moving is Expensive
You are reducing the cost of your home and living expenses, but the cost to move is expensive. Purchasing a new home means costs associated with the buying process including real estate fees and title insurance.
There are also costs associated with selling your home, such as any repairs for it to pass inspection and upgrades to increase your chance of selling.
Then there is the cost of actually moving all your possessions from one location to another. This includes the moving truck, any repairs or upgrades to your new home, and the purchase of furniture or appliances.
Small Isn’t Always Cheaper
Location can impact the cost of a smaller home. If it is in a prime location, close to conveniences such as restaurants, stores, and public transportation, it may be as costly as your larger home to purchase. It is important to check into the cost of property taxes, homeowner association fees, and any other costs that may drive your daily expenses up rather than down.
You Need to Part With Possessions
When you downsize you will need to get rid of personal items and furniture. This means you will need to sort through decades of property accumulation to decide what stays and what goes.
Sorting through possessions is time-consuming and having to part with items can be emotionally difficult. If you are emotionally ready to take this giant step the process is easier.
It Will Not Cover Your Retirement Costs
Downsizing is a great way to boost your monthly income and reduce your monthly expenses. Even if you land a sizeable profit from the sale of your existing home, it will probably not be enough to fund you all the way through your retirement.
It is important you begin saving for your retirement as early in your adult life as possible. AARP uses a calculation of 70-80% of your pre-retirement income will be needed to maintain your standard of living. This means if your income is currently $75,000 a year, you will need between $52,500 to $60,000 of income per year when you retire.
Reduced Ability to Entertain
If you are in the habit of hosting large holiday gatherings with friends and family, you may not have space in your new home for large parties. This is especially true during inclement weather when people are unable to flow out into the yard.
You may no longer have the ability to accommodate overnight guests. This is something to consider if friends, grandchildren, or other family members frequently stay overnight with you.
Decreased Personal Space
If you are living in a large home with a spouse or others, you likely are able to retreat to separate areas for hobbies, TV, exercise, or other activities.
In a smaller home, there will be fewer areas in which you can spend time alone. You will likely be sharing office space, hobby space, and TV space. This change in lifestyle proves to be more stressful than relaxing for some people.
The House Feels Cramped
There is a fine line between cozy and cramped. Purchasing a small home with plenty of windows will help open the area up, making it feel larger.
You may also need to purchase new furniture that fits your new home. Purchasing items that have multi-uses and built-in storage reduces the cramped feeling.
Even something as simple as downsizing the appliances in your new kitchen can make your space look roomier. Do you really need a 12-cup coffee maker, or will a smaller 1-4 cup work? Is the large 4-slice toaster still necessary, or can a smaller 2-slice version work?
The key is to have only those items you need and use on a regular basis
If you are leaving a home you have been in for years, where you lived with your now-deceased spouse and raised your children, it holds memories. Leaving that home behind can be emotionally difficult. Prepare yourself for the emotional tug you may feel when sorting through possessions, during showings of the home, or when you close on the sale.
Adjusting to a New Home
You know the sounds your house makes, who your neighbors are, and can drive to the grocery store with your eyes closed. These are all things that will be unfamiliar when you move into your new home.
Introduce yourself to neighbors and ask for their recommendations on shopping. Take a walk around the block and familiarize yourself with your new surroundings. It may take time for you to become comfortable in your new environment.
Making the Decision
The best course for timing when to downsize is when it is emotionally and financially right for you. You may want to consider the real estate market.
If you downsize in a seller’s market, your home will likely sell at a higher price, resulting in you having more cash-in-hand at closing. The downside is that you may have to pay a higher price for your smaller home.
If it is a buyer’s market, you may be able to purchase a nice home at a bargain price. The downside is your existing home will likely sell at a lower price, giving you less profit at the time of closing.
Evaluate what your reasons are for downsizing. Is it because your home has become a burden to care for, you are financially unable to stay in your current home, or you want to move closer to family? Once you lock in why you are looking at how to downsize, you will put yourself in a better position to handle the changes emotionally.
When downsizing your home, size does matter. The use of space-saving furniture, appliances, and storage items will help you make the most of your new, smaller home.
Gift of Space has everything you need to make a small living work for you. Whether you are downsizing or planning for the future, start shopping for downsized accessories and furniture now. Compact and functional pieces impact the style and comfort of your home. Check out Gift of Space today!