What To Know When Downsizing A House
Looking at the advantages of downsizing your home, how to downsize and what downsizing means.
Getting older means lots of different things for lots of different people. It means looking forward to retirement, to paying off the last of your mortgage, or spending more time with family and friends. One thing that people often start to consider as their children fly the nest or they get closer to retirement is downsizing.
Downsizing and upsizing are very natural parts of moving through the property ladder. In this blog post, we will be looking at the advantages of downsizing your home, how to downsize and what downsizing means.
Downsizing A House
Downsizing is when someone moves out of their property in favour of a smaller, often cheaper house that they can grow old in. It allows people to move to be closer to family, friends, and local amenities.
Whilst the phrase ‘downsizing’ often implies moving to a smaller property, it also applies to people who move to a lower-value house or flat in order to release equity in their current property.
How To Tell When It Is Time To Downsize
It can be difficult to tell if you are ready to downsize, however, there are tell-tale signs that may be an indication that downsizing is the right move for you.
Maintenance Overload – If general day-to-day maintenance is beginning to become too much of a struggle for you and you have found yourself falling behind on repairs and improvements, this could be a sign that it is time to bite the bullet and downsize your home.
Unused Spaces – If when walking around your home you find that there are more unused rooms than there are used rooms, it may be a sign that is time to downsize. There is very little point in spending time and money to keep unused rooms heated and clean.
Retirement Is Looming – Another sign that you may be ready to downsize is if retirement is looming. Downsizing can be a good way to set yourself up for retired life. If you are living in a property where the value has risen steadily over the years, then selling up and downsizing would be a way of setting yourself up for retirement.
Empty Nest – Children leaving home is a huge milestone in every parent’s life, and whether it is something you are dreading or celebrating, having an empty nest is what gives a lot of downsizers the push they need to begin the process. They find that a family home feels too big and empty and that by moving to a smaller property, often closer to family and friends, they can make the most of their homes.
When Is The Best Age To Downsize?
Whilst there is no scientifically proven best age to downsize, research from AgeUK has suggested that the ideal age to downsize is 64, as people are still mentally agile enough to deal with the house sale process and benefit the most from getting rid of any unused space.
Advantages Of Downsizing Your Home
There are many advantages to downsizing a house. It can mean you are closer to family and friends and to local amenities, as well as saving you money. Some of the main advantages of downsizing your home include:
Equity Release – One of the biggest issues that people come across after they retire is that they become asset rich but poor in terms of how much cash they have to spend. By downsizing a house and buying a smaller, less expensive property you can free up any of the equity that you have tied up in the old house. This equity can be put towards things such as helping family members to buy their own homes, paying off the shortfall on a mortgage, or funding your own retirement. Pension firm Prudential conducted research that showed the average downsizer could achieve savings of around £112,000 by selling their home and receive an annual income of almost £14,000 if the money released from the sale was used to buy an annuity (coupled with a state pension).
Lessen Your Maintenance Burden - Another one of the advantages of downsizing your home is that smaller homes bring with them less effort with general maintenance. Whilst you may currently be able to manage all the maintenance work and general cleaning that your property requires, it is a smart idea to consider the future and consider if you will still be able to manage.
Lower Monthly Outgoings – Another perk of downsizing a house is that with low-interest rates badly affecting returns on savings, you can help to reduce the cost of bills. The average downsizer could make annual savings of over £500 on energy bills alone by downsizing from a four-bedroom house to a two-bedroom house according to current estimates. They also suggest that relative savings on tax, insurance, maintenance, and even mortgage payments could be possible.
More Local Amenities Nearby – Whilst living in the peaceful isolated countryside is the idea of heaven for some people, it often means that residents depend heavily on driving to be able to get to local amenities. In the event of mobility becoming an issue for you, downsizing to an area with good transport links, where there is a bustling high street nearby and is in close proximity to local leisure facilities and doctors’ surgeries may be a good idea for you.
What Is A Good Size House For Downsizing?
Whilst there is no set size for a property to downsize to, according to Southern Living, the best size home to downsize to is 1,500 square feet.
What To Consider Before Downsizing A House
Lifestyle Changes – As with moving anywhere there are lifestyle changes involved when you downsize. You may be moving into a new area or a different type of property and whilst it can be a daunting thought, there is often a reason that you have chosen your new area or property so this is important to keep in mind.
Lack Of Space– Downsizing can present challenges in the form of the lack of space you may now have compared to before. However, this lack of space can present you with the chance to redecorate your house and declutter your current home.
Moving Costs - Moving costs vary depending on where you’re moving to, how much you want to move, and the time of year you move among other factors. Whilst this can add to the stress of moving, you would have to pay for moving costs if you decided to move house, downsizing or not.
What are your reasons for downsizing? Are you happy about this potential change or are there other routes you can take to avoid it?
If this is a road that you want to go down then you’ll next need to consider where you want to move to. Are you looking at staying in the same area or further afield?
When downsizing a house, it is important to consider what type of property you want to move into. You need to look at properties that will work for you, where they will be located and how accessible the new property will be for you.
You also will need to consider whether or not you wish to pay off your mortgage fully before you sell the property.
When you are downsizing a house, you need to start decluttering as soon as possible in order to prep for your move.
As soon as you have decided on location and property type, it is time to start house-hunting.
How To Downsize
If you decide that downsizing is for you then there are several ways that you can go about selling your property. These ways include via an auction, through an estate agent, or through a genuine cash buyer. Each different way provides its own pros and cons.
One of the most popular ways that you can sell a house is through an estate agent. Estate agents will undertake all of the responsibilities that come with selling your home in return for a ‘commission’.
One of the huge pros of selling through an estate agent is that they will do all the hard work for you, such as creating a listing for your property and advertising it for you.
However, the downside is that selling through an estate agent can be time-consuming. You will need to book house viewings at your home for potential buyers, which can be a lengthy and inconvenient procedure. It will mean taking time off from work, making sure that any issues with the house are fixed and at the end of the viewing you may still not have a buyer and will have to begin the process all over again.
Another downside to selling your house this way is that it can take months to find a buyer on the open market. Finding a buyer this way is not guaranteed, and if you are keen to start your downsizing journey is not ideal!
Selling through an estate agency also means that after you have dealt with estate agency fees and taken time off work for viewings, you will still have other fees to pay such as legal fees and removal costs. Those extra costs can add up and eat away at the final profit of our house.
Selling Through An Auction
Another route you can go down when downsizing a house is to sell your property through an auction. This is an option that is not explored as much but it means that you can sell your house to a group of bidders. At a housing auction, you agree on a minimum reserve price for your home, and if a buyer bids on it, it will sell.
In the best-case auction scenario, multiple buyers will be interested in the property and will be outbidding each other, raising the total of your final profit.
Another positive to selling your property through an auction is that auctioneers will have a vast range of experience with selling all kinds of properties, meaning that you and your house are in good hands.
However, there are issues that come with selling your house through an auction. One of these issues is that selling through a property auction involves a lot of waiting. Once you have listed your property for sale, you will have to wait for the next auction which could be weeks or months away. Waiting for the next property auction is not ideal for sellers who are looking for a quick sale as they already have their eyes on another property.
Even after the auction is complete, you will still have to wait for the paperwork to go through which can take a month or more and will once again add to potential delays in selling.
Furthermore, selling through auction is not without costs. Auctioneers charge a commission to cover the cost of marketing and selling your home, which can eat away at the final profit of your home.
Another option when downsizing a house is to sell it through a genuine cash buyer. A cash buyer is the best way to ensure a quick sale on your house.
Another positive that selling through a cash buyer brings is that the sale is guaranteed in a timescale that suits you.
If this sounds like something that you would be interested in, then look no further as we are here to help!
At The Property Buying Company, we are a cash buyer of houses who buy any house in any location in a time scale that suits you! Plus, we cover all the fees for you- even the legal ones!
We will only require one quick viewing to make sure that our cash offer is accurate and as we are a genuine cash buyer, once you have accepted our offer that is the amount that you will get in FULL in your bank!
We are also a member of the National Association of Property Buyers and The Property Ombudsman, as well as being rated excellent on TrustPilot, with over 1000 reviews, allowing you to feel safe in our hands.
So, if you are ready to sell up and downsize, give us a call or fill in our online form for a free, no-obligation CASH offer which we could have in your bank as soon as you choose…