7 Steps To Downsizing for Seniors
Moving into a smaller home doesn't need to be a stressful experience.
There are many emotions you are likely to experience when downsizing from your current home.
While it feels daunting to leave a home that you have built so many memories in, you know it’s time to go. After all, your family home feels empty now the children have moved out and there is something exciting about starting over.
Perhaps the house is large and hard to clean, and maintaining the garden has become a full-time job. It’s time for a clean slate, a simpler life, a fresh start. Here is a seven-step guide to help you through your journey.
1. Location, location, location
Where will you live next?
Your fresh start might mean choosing a new neighbourhood, state, or country to discover. If the children are all based overseas, perhaps you’ll want to be close to them. If you have a favourite vacation spot, maybe it’s time for a permanent vacation. Or, maybe it’s as simple as moving to a peaceful suburb near the ocean in the same city, one that you know and love.
Whichever location you choose, make sure you evaluate all your options and pick the place that will make you happiest.
2. Tiny home, penthouse or retirement village?
You’ve picked your dream location, so now it’s time to choose which type of home you want to live in.
There are a range of senior's real estate options to choose from - whether you opt for a smaller home, a penthouse apartment or even community living in a retirement home, this will depend on your personality type, your interests, and your circumstances.
As a senior downsizing, one thing to keep in mind is that if you have health issues, consider your health and mobility over time. A hilltop residence with a stunning beach view might not be practical if you have a bad back. Consider a home with that same stunning view, but at ground-level instead. There’s usually a way to live your dream within your means.
3. Your financial wealth
Before purchasing your new home in your dream location, it’s important to review your plans from a financial perspective to ensure your lifestyle is sustainable in the long-term.
If you’re retired or close to retirement, the proceeds from selling your home will help with your ongoing living expenses, in addition to your pension or superannuation. If you are mortgage-free and in a position to purchase elsewhere, consider renting out your current property as an additional income stream.
It’s worth seeking the help of an impartial financial advisor when considering your current and future income. They will help to identify any tax implications or other financial considerations you should be aware of before making any concrete decisions. For example, retirement villages and assisted living facilities often have guidelines for owning other properties and may require lump sum bonds upon entry.
4. Know what you have to work with
Another key consideration is the value of the home you are downsizing from. What will you get for selling your property in today’s market? All it takes is a little bit of research to get a sense of your property’s value.
Start by looking at recently sold properties on websites like realestate.com.au or domain.com.au located in your suburb with similar features to yours. How much did they sell for?
You can also purchase a professional valuation report from valuation companies like RP Data. If you sell with us at buymyplace, you’ll have access to Market Comparison Reports powered by RP Data.
Remember to set a reasonable sale price for your property and the market will respond accordingly.
You also have the option of commissioning a real estate agent or professional valuer to give you an indication. Remember, you’re not locked into selling your property with them by doing this, and you should feel no pressure beyond the valuation service.
5. How will you sell?
Another big consideration is whether to list your property with an agent or take control of your biggest asset and sell it yourself.
We understand there are certain circumstances where selling property through a real estate agent is the wisest option, such as when you are not physically able to host open for inspections.
However, it’s worth asking agents about their commission rates since they average 3.25 per cent of your property’s sale price in commissions, including 1 per cent for marketing fees.
On a $600,000 home, that’s approximately $20,000 taken out of your pocket and put into theirs.
It’s not hard to sell your own home, especially if you’re paying yourself $20,000 instead of an agent. Besides, who knows your property better than you? You’re the best person for the job.
Private real estate companies like us at buymyplace provide all the tools you need to successfully list your property on the market. You’ll also have access to the same advertising opportunities as real estate agents, so you can sell your property like an expert. Plus, our marketing campaigns come at a fixed cost, so you’ll pay $0 commission, regardless of your home’s value.
No doubt, the task of clearing out many years of memories and belongings can be a tough one. But if you’re downsizing, the reality is it can’t all go with you. Cleansing and decluttering are crucial steps in making your home look its best for the new buyer or tenant.
If you have bulky sentimental items, take a photograph and consider passing them on to a family member who will treasure them as much as you did. Offer as many items as possible to family members and loved ones.
You can also lighten your load and make some extra money by selling unwanted items online or at garage sales. Alternatively, donate those items to charity in good conscience. One man’s trash is another man’s treasure, after all.
7. Let the house hunting begin
You have all your ducks in a row – a neat, de-cluttered home and a strong idea of what you want for your next chapter in life — and now it’s time to begin the search for your new place.
Finally you can act on your research and put your plans into place. Remember, now is not the time to be complacent. Make sure you’re familiar with market conditions for where you want to purchase, and if you’re moving to a whole new area or changing lifestyles, be sure to look at recent sales in your chosen area.
You might even purchase a suburb profile from RP Data, which indicate current, average property prices. They also provide demographic information, such as the age and interests of people in the area, which will ensure you are moving to an area of like-minded people.
The next chapter of your life is what you make of it. With a positive attitude, a sound plan backed up by your research, and friends and family to offer support, it’s sure to be an exciting journey.