Downsizing your Home: Three Questions to Ask
According to the TD Canada Trust Boomer Buyers Report, four in five Canadian boomers say that the next time they move, it will be to a smaller home. 46% of respondents will be downsizing to save money, and 34% wish to enjoy more luxurious features – considering the luxury amenities that many upscale Toronto condominiums offer, this is no surprise! You don’t need to be a boomer to downsize, though: downsizing can have a lot of advantages, as long as you plan well and know what you’re looking for.
There are numerous advantages to downsizing, whether it’s to a smaller home or to a condo. Between a smaller mortgage, lower property taxes, lower maintenance costs, and lower energy bills, you can save quite a bit of money. You’ll also be reducing your energy consumption, you’ll have less work to do to maintain your property, you may have a safer and more accessible space - and if you choose to go the condo route, you may have access to amenities and luxuries that you would not otherwise be able to afford on your own.
Before you put your larger house on the market, though, here are three things to consider about your downsizing options.
Given that the number one reason most people choose to downsize is to save money, get the facts on how much money you’d actually be saving. Once you’ve sold your home and purchased the new one, how much money will you actually have left?
Don’t forget to factor in costs such as renovations and closing costs. How much will your property taxes and utility bills actually go down? If you’re moving to a new community, what’s the cost of living there as compared to where you are now? If you’re planning on moving into a condo, what are the condo and amenity fees?
Once you’re clear about how much money you will actually save, weigh the benefit of those savings against the potential costs of moving to a smaller space.
Retiring baby boomers often downsize because, with an empty nest, they simply need less space. Before you give up the sprawling family home, however, ask yourself honestly if you do - or could - use that additional space.
For instance, some hobbyists love having an extra room devoted to sewing, painting, model trains, or whatever they love to do. Others who work from home turn extra bedrooms into office spaces. Perhaps most importantly, will you want to have a place for visitors—kids and grandkids, for example—to stay? What furniture and possessions are you willing to give up in order to fit your lifestyle into a smaller home?
Amenities & Accessibility?
If you’ve owned your home for quite a while, you’ve built a life in that home and made it comfortable for yourself. What comforts do you want to have as you age? What new amenities might you want? How accessible a space will you need as you age?
The answers to all of these questions will support you in making a decision of whether, and how, to downsize. If you want to keep some space and independence, but need a more accessible home in which to age, moving to a one-storey home in a neighbourhood with amenities (groceries, drugstore, etc.) close by may be the right move for you. If you want to have a pool and/or gym close at hand, and never want to worry about maintaining your home again, a condo building may be a better fit.
Regardless of your reasons for wanting to downsize, planning is the key. Spend the time now to really think about what you want your life to look like down the road, and what kind of home will work with that vision.