Downsizing your home – the pros and cons

How is downsizing defined?

Downsizing happens when you want to sell your flat or house in order to move into another property that is smaller. There are many reasons why people might want to do this, and it’s something that homeowners of all ages might consider depending on their circumstances.

Elderly couples might want to move into a smaller home once their children have left and grown up, or if they can no longer handle the upkeep of a larger property. In addition, if a partner dies it’s possible that the other partner might want to move into a smaller property. Or if a person needs to move into a residential home, that’s another type of age-related downsizing.

Financial concerns can also be a reason for downsizing no matter the age of the homeowner. If they need to release cash quickly to cover some debt, they might try selling their house or flat and then move into a smaller home that has reduced, and more manageable, mortgage payments.

Or sometimes people simply want a change of scenery and want to own a smaller house because it means less maintenance and it will give them more free time and money.

What are the potential pros of downsizing your home?

You’ll find that there are a wide range of benefits if you decide to downsize your home, including the fact that moving into a smaller property means less maintenance. Your energy, water and other bills should be much lower, and the time involved in keeping the property in good condition will likely be a lot less than in a significantly bigger property.

It can also be a great way to cash in if your home has suddenly increased in value, making a good profit. This could help you to pay off any mortgage you might still have, or give you the cash you need for purchasing your smaller home with money left over. Property websites like Zoopla can be useful to obtain an instant idea of the price at which houses in your neighbourhood are currently valued, although you should use online estimates as only a rough guideline because they are sometimes based on outdated information and might not reflect more recent changes to local property values.

Because downsizing typically means you’ll be moving into a home that costs less to buy than the value at which your current home might sell, you could also end up with leftover extra cash in your bank account. You can then use these funds for other expenditures such as holidays, buying new furniture, or even putting the money in a savings account to earn interest.

When you downsize you also have the luxury of waiting to find the house or flat that gets you what you want from a smaller home. If you need less space in your next home you can take your time to find a house that fits your various requirements. Or if you’re looking to move to a retirement estate you can spend time visiting various options before buying.

And what are the possible cons of downsizing your home?

The ever-fluctuating property market can be a primary reason for staying in your existing house or flat because there’s always the potential that its value could rise significantly in future years. If you downsize and move you run the risk of losing out on making more money on your home.

Another con of downsizing is that house hunting can be a long and tiring process, and you might struggle to find a smaller home that fulfils all of your various needs.

Even if you find a new home that you like and make an offer to buy it, there’s no guarantee that the sale will actually go all the way through to completion. There are many reasons why home sales fall through, and if this happens when you are trying to downsize it will simply put you back to square one in searching for your next property, costing you more time and stress.