Reasons Why Downsizing Might Not Be For You
For some time the standard or common routine of homeownership for retirement was to trade off the expensive home you raised your family in for a smaller and easier-to-keep property often in a destination that was warm and dreamy. But currently, more homeowners are getting rid of this notion that retired homeowners automatically need to get the for sale sign out on their large family home to trade it for a smaller property. This was the trend of downsizing. Downsizing is a great concept and can be very helpful for many people but for some, it may not make all the sense in the world.
Here are some reasons downsizing may not be for you
The cost of selling is a bit high
Some of us don't often think about this when putting our home up for sale but there are costs that you will pay when you sell and finalize that sale. You may need a certain amount of money from the profit on the sale of your home and the costs might cut into that. It is also good to look at current market conditions to determine if the market value of your home is at the ideal price point for making the profit you might need to get out of the sale of your property. It is also good to consider your capital gains tax responsibilities as this is a significant cost of selling a home.
You would not feel comfortable with less space
Even if some of the members of your home have moved out and some of the space in your home is not occupied by as many people you still may not feel personally comfortable living in a smaller space. A smaller home could mean giving up an office or an extra living area where other members of the house could do one thing while you do another. Going smaller could mean giving up these extra rooms that you use on a daily basis. If you feel you use the space in your home well then it really is no reason to opt for a smaller home.
You could turn the extra space into a money-maker
It is not uncommon for many retirees to be living on a fixed income. A good way to bring in some supplemental income is to use the extra space in your home to make money. This could be done in a handful of different ways including renting out a portion of the house on Airbnb or turning some of the space into a new small business venture. For example, if you were once a hairdresser you could get your license to serve fewer clients within your own home. Or you could rent a portion of your extra space as storage.
There may be a future need for multi-generational living
If you have parents who are also in their golden years of life you may be in need to have them move in with you in the near future. This larger space would allow you to be able to take in your aging parents and help care for them as they may need more assistance with daily tasks. There are many retired homeowners who are holding on to their space in order to be able to live with multi-generational needs.
Trading for a new mortgage just wanted to make sense
Some homeowners have a pretty good setup with their current mortgage. Some may own their home outright and only pay property taxes and utilities. It may not be the best financial decision to trade a current mortgage for a new one when mortgage rates are increased even if the home you purchase may come at a lower price tag because of the lesser square footage. Make sure to do the math on what it would cost for a new home payment to ensure that downsizing won't cost you money instead of saving you money.
If you have a beautiful Sanibel home that you love there is no pressure to downsize just because of the stage of life you are in. If you are looking to downsize or are considering your best options for your home at this time of life I am happy to talk that over with you. You may find that you love your current home and you are comfortable there. Or you may find that you would love to live just down the road on Sanibel Island in a home that requires less effort to maintain. I am happy to help with any Sanibel real estate needs you have.