Suggestions to help decide on your upcoming housing change
The kids departed a while back, you’re tired from shovelling snow and mowing lawn, and a majority of the rooms in your home remain unused. Why not think about downsizing?
You will have company. Many retirees relocate to downsize to a smaller residence, such as a house, condo, or apartment. One of the main factors is reducing costs. Many baby boomers have more value in their home equity than in their retirement savings. Their wealth resides there.
Deciding to downsize necessitates serious considerations. Where are you planning to relocate? Should you choose a condo, an apartment, or a smaller house? Choosing the incorrect action will result in a loss. You might need to relocate again. You must perform thorough research and investigation. Here are a few inquiries to ponder before finalizing your choice.
Where are you headed?
Relocating to a more affordable neighbourhood or downsizing to a smaller house would result in savings on both the buying price and property taxes. Alternatively, relocating to a more convenient location, near family or amenities, could result in the need for only one car. Additionally, if you cannot operate a vehicle, you would be in proximity to necessary items.
Condo or detached house?
Typically, condos are cheaper than single-family houses and also offer the convenience of not having to clear snow or cut grass. Moving to a condo can potentially help you release some of your equity for investment purposes and lower your utility and maintenance expenses.
Should I purchase or rent?
There are numerous elements to consider in this situation. If you have always been a homeowner, you might be interested in the concept of purchasing another property. Nevertheless, consider the duration for which you anticipate residing in the new location. If the duration is under 5 years, then the expenses associated with selling quickly will probably be more than any possible profit. And it’s likely more advantageous to just rent.
Get your copy of the “Preparing to Downsize” guide
Do you have a significant amount of equity in your home but only a small amount saved up?
Investing the money from selling a house into generating a monthly income could be the most optimal decision. This income, along with not having to pay property tax, certain utilities, and home upkeep, could pay for most or all of your rent.
This will not only generate a monthly income for you but also potentially increase in value more quickly than residential real estate, depending on your investment choices. Also, remember that the money you get from selling your house is not subject to tax.
Summary
Immediately or at a different time? Although many retirees are hesitant to depart from their family home, the truth is that doing so sooner rather than later is advisable. Moving in your sixties is more manageable than moving in your eighties. Also, do not procrastinate moving until you are compelled to do so because of an unforeseen health issue. Attempting to make a sale in that scenario is, at most, disorganized.
Conduct a truthful evaluation of the advantages and disadvantages of remaining in your home for a couple more years versus selling at this moment. Determine what is most logical for you in your specific circumstances.