Downsizing is a difficult decision that’s unique to each homeowner. Seniors who aren’t quite certain if downsizing is right for them can consider three key factors to make a decision that’s in their best interests.
Cost: Perhaps no variable affects senior homeowners’ decisions to downsize their homes as much as cost. No one wants to outlive their money, and downsizing to a smaller home can help seniors reduce their monthly expenses by a significant margin. Even homeowners who have long since paid off their mortgages can save substantial amounts of money by downsizing to a smaller home or even an apartment or condominium. Lower property taxes, reduced insurance premiums and the need to pay for fewer repairs are just some of the ways downsizing can save seniors money.
Space: Many people love the extra space that single-family homes provide. But seniors can take a walk through their homes and see how many rooms they still use on a consistent basis. If much of the home is unused, seniors can probably downsize without adversely affecting their daily lives.
Market: The real estate market is another factor to consider when deciding if the time is right to downsize. A seller’s market can help seniors get the biggest return on their real estate investment, potentially helping them make up for meager retirement savings. For example, home prices skyrocketed across the country during the COVID-19 pandemic, making that a great time for sellers to put their homes on the market. Seniors selling to downsize may capitalize on such spikes since they won’t be looking to turn around and buy larger, equally expensive homes once they sell their current place. If the market is down and seniors can withstand the work and cost a little longer, it may be best to wait until things bounce back in sellers’ favor.
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