Once their kids have left the nest, many men and women over 50 begin to consider downsizing their homes. Downsizing to a smaller home can be beneficial for a variety of reasons, including less home to clean and maintain, more affordable utility bills and lower property taxes. But the decision to downsize is rarely black and white, and men and women often struggle with that decision.
Perhaps the most difficult part of the decision of whether or not to downsize to a smaller home concerns the sentimental attachment many homeowners, especially those with children, have to their homes. The home might be too big for your current needs, but it also was the same place where your son took his first steps and where your daughter lost her first tooth. Saying goodbye to a place that was home to so many memories isn't easy. But there's more than just sentimental value to consider when deciding whether or not to downsize your home after the kids have grown up and moved out.
Your financial situation merits significant consideration when deciding if the time is right to downsize your home. If your retirement nest egg is not as substantial as you would like it to be, then it would seem as though downsizing to a smaller, more affordable home is a great opportunity for you to start catching up on your retirement savings. But that's only true if your new home won't incur any additional expenses that are already taken care of in your current home. For example, your current home may be fully furnished, while a new, smaller home may require you to buy all new furniture because your existing items simply won't fit. The cost of such furnishings can be considerable. If you plan to move into a condominium, you can expect to pay monthly homeowners association fees, and such fees are often substantial. So while the condo itself might be smaller, the additional expenses associated with the property may end up making the smaller home more expensive and prevent you from saving more money for retirement.
Real estate market
There are seller's markets and there are buyer's markets, and ideally you would like to sell your home in a seller's market. But keep in mind that this might be the same market in which you hope to buy a new home. The nature of the real estate market depends on a host of factors, including geography. If the city or town where you currently live is in the midst of a seller's market and you are planning on moving to a location where buyers have the upper hand, then now might be a great time to move. But if you currently live in a buyer's market and hope to move to a seller's market, then you may end up paying a steep price, even when downsizing to a smaller home. Things may even themselves out if you want to downsize to a smaller home within your current community, but do your homework nonetheless, researching the time of year when you're most likely to get the most for your home and find the best deal on your next place. The advantage men and women considering downsizing have is that they are rarely in a rush to move out of their current home and into their next one. This gives them ample time to make the real estate market work for them.
How much space do you really need? Once the kids have moved out, couples may feel like all of that extra space is going to waste. But that can be a knee-jerk reaction, and upon a more thorough examination of the space and your needs you may just find that you can put all of that extra square footage to good use after all. If you have always wanted your own art studio, then now might be the perfect time to make that a reality. Always wanted a room devoted to home theater? Get to work on converting your basement from an all-purpose game room to your own private movie theater. If, after considering the space in your home, you find that the extra square footage really is just upkeep you aren't especially interested in doing, then you would no doubt like a cozier home that's less of a responsibility to maintain.
Downsizing a home is something many men and women over 50 consider after their children have moved out. Such a decision is rarely easy, so homeowners should take as much time as they need before making a final decision to move or stay put.