While new homes are getting bigger and bigger—gaining nearly 15% more square footage since 1990—many current homeowners are thinking about ditching their big digs for smaller spaces. Whether you’re a Boomer who’s tired of cleaning a large, empty nest or a Gen Xer who’s intrigued by minimalism, downsizing may be just the change you need.
Before you spend long hours fantasizing about an urban condo or lakefront cottage, though, make sure you’ve taken an honest assessment of the financial, physical, and emotional ups and downs of downsizing.
Financial Ups and Downs of Downsizing
A smaller home has significant perks, including smaller mortgage, utility payments, insurance, maintenance, and property taxes. But there are expenses, too:
- Costs related to selling your current home. In addition to hiring a real estate professional, you may also need to invest some money into making your current home market-ready. Keep in mind that people seeking to purchase your home are likely upsizing, so their primary focus will be the heft of their new mortgage. They’ll likely expect you to take care of any major repairs, like a new roof or HVAC system.
The housing market has implications, too. Right now, there’s a significant lack of inventory, so it’s a great time to sell a home. If the market flips, though, you could make less from your home sale than you’d hoped.
- Costs related to your new home. Conversely, given our current seller’s market you may discover smaller homes aren’t that much less expensive, per square foot, than the larger one you’re hoping to let go of. Are you prepared to pay more money, relatively speaking, for a smaller house? Think about the resale value of your new place, too; will you be in it long enough to recoup your costs?
Even if you find an outstanding deal, you’ll incur other costs: a storage unit if you can’t squeeze everything in, all manner of organizational systems to maximize what little storage space you do have, and smaller furniture (because there’s no way that sectional’s going to fit).
Finally, factor in homeowners’ association fees (HOA), which can be sizeable in low-maintenance townhomes and condos.
Physical Ups and Downs of Downsizing
Daydreaming about having fewer toilets to scrub? We get it. Downsizing allows people to shift their time and energy away from maintaining their home and toward more meaningful activities. That’s a definite plus.
But be sure to also imagine what it would be like to have fewer (and smaller) closets, cabinets, and rooms. You might have every intention of donating half your stuff and pitching most of the rest of it, but you’ll still need to be realistic about what, exactly, you’re willing to give up. Could you and your partner deal with a Queen bed instead of a King? Could you really part with grandma’s Christmas dishes?
Speaking of Christmas, are you accustomed to having large gatherings of friends or family? Will you still be able to do that in a smaller home? And what if—and we know this won’t happen to you—but what if your kids have to come back home for a season? Will you be heartbroken if you don’t have enough room to accommodate them?
Emotional Ups and Downs of Downsizing
Simplicity is all the rage, and there’s no question that having less “stuff” is good for our emotional wellbeing. Downsizing can certainly facilitate a more minimalist lifestyle.
On the other hand, whether we like to admit it or not, most of U.S. culture still believe “bigger is better.” If you’ve worked hard to climb the corporate ladder or keep up with those pesky Joneses, will you be okay—really okay—if you don’t have a luxurious home to show for it?
If your ego’s not so easily bruised, how about your heart? If you—or your family members—are the sentimental type, think about the firsts and lasts that took place in your home: first steps, high school graduation parties, retirement celebrations, and so on. Think about your neighborhood, too: If you have a good support system where you are, would it be better to stay put?
Downsizing is a big decision with a lot of ups and downs to consider. If you’re thinking about making the move, let us know. Las Vegas offers a wide variety of fabulous neighborhoods for every personality and lifestyle. We’re here to help!