Downsizing Your Home

Moving to a smaller home, that is, downsizing your home is a great way to free up some equity from your current home mortgage, live a different lifestyle, and save money in the long run.

What is downsizing?

Downsizing is simply the decision to move to a smaller home like a prefabricated modular home. Typically downsizing may take place around retirement age or when parents have their children move out of their home. However, downsizing earlier in life has its benefits as well. 

What are the benefits of downsizing?

• Purchasing a smaller, cheaper home could mean you are able to buy mortgage-free and will be able to benefit from the advantages of being a cash buyer
• By selling your home, you benefit from the extra equity that’s built up over the time you’ve kept your home This is referred to as “release of equity.”
• Downsizing to a smaller home will result in lower running, maintenance, and insurance costs. This saves you money in utility bills and time in repairs and maintenance.

When is a good time to downsize?

Home downsizing is a decision you make after considering your health, financial situation, and your future plans. This means putting less stress on your body as you get old such as climbing stairs or gardening. This could also mean moving to a smaller home in a more rural area, or “off the grid” where there’s less noise and pollution.

When choosing to sell your existing property to buy another one, you will need to take into account the costs. These will include:

• Real Estate agent fees
• Price of new home
• Lawyer fees
• Moving costs
• Decluttering costs

The intention of downsizing is to make life simpler. One way this is possible is a smaller property that’s easier to maintain. Another way is the freedom to use the gained equity in the property you sell for a new phase in life such as traveling the world.