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5 things to consider when downsizing

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The Smart Booster Home Loan is our low rate home loan which allows you to boost your savings, build your equity and own your own home, sooner.

  • 2.60%
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  • 2.96%
    comparison rate p.a.*

You’ve decided to downsize your home and are ready to make the move… so what comes next?

Whether your current property is taking more time than you’d like to maintain, your children have fled the nest, you’re entering retirement or you’re simply ready for a smaller home, there are a few things to take into consideration before you make the move.

Here are 5 things you should consider when downsizing your home:

1. Make sure you’re sure

There will be many benefits to downsizing, including having more disposable income and de-cluttering your home. However, it’s important to understand there may be some downsides when you downsize, such as:

  • You may have to move to a different suburb to find a smaller home

  • You may have to get rid of some belongings, and existing furniture may not fit in your new property

  • You may not be able to accommodate guests as it is likely you will have less rooms

  • Your existing furniture may be too big for your new property.

2. Don’t be afraid to let go

It goes without saying - a smaller property = less space for your belongings, so don’t be afraid to let go of unessential items, or, as Marie Kondo says, items which do not ‘spark joy’. It’s likely you will have a lot of unused furniture lying around, so think about the last time some of your items were used and decide if you can sell them online, or even donate them to someone in need.

Obviously there may be belongings that you can’t or don’t want to part with just yet. In this case, it could be worth factoring costs of an external storage space into your move.

3. Decide on what’s most important to you

There are two factors that are important to consider before you start searching for your new home - the property itself and the area it is in. Take your time to think of what you love about your current home and also area you live in. Consider the following questions:

HOME

  • What do you like about your home?

  • What could you do without?

  • How many rooms do you need?

AREA

  • Do you want to move somewhere calm and quiet, or busy and populated?

  • Do you enjoy walks by the beach or through national parks?

  • Are there particular amenities that you want or need close by?

4. Research, research, research!

Now you’ve made a list of what features are important to you and the type of area you’d ideally like to be in, it’s time to find your next home! So spend the time looking for something that ticks your boxes.

TIP: Find a property that will still have enough space and storage for the things you love most so you don’t have to give up too much of your current lifestyle.

Once you’ve found a smaller property that you’re interested in, make sure it has the facilities and amenities close that you’ve identified you need. This may include:

  • Public transport

  • Doctors, dentists, and other health care services

  • Parks or gyms

  • Restaurants, cinemas, shops.

Get a free property report with http://loans.com.au to learn more about the property you are looking to purchase. Each report includes an estimated price range for the property, recent sale prices for similar properties in the area, details of nearby properties that are on the market, information on the suburb’s performance and a suburb profile.

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5. Finances

Consider how much you can sell your current home for in today’s market. In some cases, it may be less than the smaller home you’ve had your eye on, depending on where you are looking to buy. When you know what you can afford, be aware of the following potential costs involved:

  • Moving costs

  • New smaller furniture, smaller appliances

  • Any body corporate fees

  • Storage fees

  • Cost of living in the new area.

You may be able to move into your next property without a loan, but if you do need a home loan to achieve your downsizing goal, http://loans.com.au may be able to help.

Not sure when it’s time to downsize?

It can be difficult to move from a larger home to a smaller one. You have become used to the space, you enjoy the openness and you have grown to love it and have fond memories there of times spent with loved ones.

However, there are times when you may not have a choice, especially if you have grown older, the children have left the house and your health is not be as good as it used to be. If you are struggling with this decision, here are seven signs you might need to start thinking about downsizing to a smaller home.

1. You Find it Difficult to Get Around

Mobility problems are the norm as you grow older. If you are starting to find it difficult to get up and down the stairs or even to get from room to room, it’s definitely a sign that you need to move to a one level property. This will make your life much easier and prevent you from injuring yourself.

2. You Find it Difficult to Find Things

People who have difficulty locating things in the home often have way too many items that they no longer need. If your home is cluttered with things that you no longer use it’s a sign that you don’t really need as much space as you think you do.

3. You Feel Lonely

Once your children move out of home or your spouse has passed away, loneliness can set in. Relocating to a retirement community isn’t going to replace family but it will provide you with a new network of acquaintances to revive your social life. It is also a great way of downsizing your home with style.

4. You Are Struggling Financially

If your bills and mortgage payments are creating financial hardship now that you have retired, downsizing is probably a wise idea. Selling your larger home and moving to a smaller one will provide you with some additional cash and relieve you of your former financial burden.

5. Too Much Maintenance

It requires a lot of work to maintain a larger home. Whether it's general chores, mowing the lawn, or repairing the property, the upkeep of a large home can become exhausting.

The majority of people can’t afford to hire a maintenance man and it can become a burden to keep asking family and friends for assistance. Therefore, downsizing might be a good idea.

6. You’ve Retired

Downsizing your home for retirement is a motivating factor for many older people. There is often a need to cut down on annual expenses to make sure your money lasts.

7. Unused Rooms

Do you have rooms in your home that are not being used? Rooms where the children used to sleep? If you are continuously walking into rooms that do nothing but collect dust, you should consider downsizing. Unused rooms are costly.

Moving to a smaller home means you don’t use as much space, spend less money and consume less energy.

If you’re ready to purchase your next home, or even just curious about how much you could save by moving into a smaller property, book an appointment with a lending specialist today to see how we can help!

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About the article

As Australia's leading online lender, loans.com.au has been helping people into their dream homes and cars for more than 10 years. Our content is written and reviewed by experienced financial experts. The information we provide is general in nature and does not take into account your personal objectives or needs. If you'd like to chat to one of our lending specialists about a home or car loan, contact us on Live Chat or by calling 13 10 90.