Is your home still meeting your needs? For most people as they start their adult lives and possibly their families, they start upsizing to larger homes with bonus rooms and big backyards. What happens when the kids move out or your lifestyle changes? The word “downsize” may bring to mind recently retired folks who’ve decided to sell their big family home and opt for a sparkly new condo somewhere sunny, and with a pool a few steps away. While that is definitely one of the ways to do it, there are many more reasons to downsize. You don’t even have to be retired!
1. More Cashflow
The housing market in the Greater Seattle Area has been booming for years, and downsizing is definitely one way to create more cashflow. You could free up more cash with a lower or even no mortgage. With a smaller home you’ll also have lower utility bills and homeowner’s insurance; you may even save more with no more HOA dues or yard maintenance costs. It’s also a viable way to consolidate a lot of debt—and lower financial anxiety. For example, sell your home and with the profits, pay off your home equity loan, college loan, and credit card, then pay off most or all of your mortgage. If you’ve been in your home for at least 10 years and it’s value has gone up significantly, you can use that equity to your advantage.
A smaller home is much easier to maintain. With our eldest launched, one in college, and one in high school, we no longer needed such a big house and yard. We downsized to a smaller but still spacious home with almost no yard, and with the house being brand new, there is nothing it needs in terms of updating or remodeling. Less to clean and keep up = more time for leisure! I’ve got a friend who is loving the freedom of her downsize from a single-family house to a condo in a doorman building. She calls it a “lock and go” setup because she literally turns one key and she can travel and work remotely from anywhere in the world.