In tougher times and especially with the issues that face our economy today, families should consider downsizing to a smaller home as an option to deal with a shortage of funds. Many families have been hit hard in this economic downturn, and can’t afford the hidden costs of owning a home. For those who don’t want to move in apartments or condos, downsizing is one way to stay in a house, but cut costs.
If you don’t already own a home now is not the best time to buy, especially if you’re unsure whether the house is a long-term commitment.. Buying a home isn’t necessarily a bad thing. There are many benefits, such as building credit through payments, tax benefits, and no noisy apartment building neighbors. However, there are costs for maintenance of a home and insurance coverage,
Larger homes have more space, but these can be hard to keep clean over time. If you just take into account the cost of energy it takes to heat a larger home the downsides start to become obvious. The cost of gas is only going to rise in the coming years so you should consider this fact before deciding on your next living space. Also consider the other expense like property tax, insurance, and maintenance. These factors can make your living situation economically unbearable.
Once you decide decide to downsize there will be items that you don’t want to throw away. They might be belongings that you don’t want to part with or family heirlooms. If this is a concern, there are options, such as storage facilities that can accommodate any storage needs you may have – from extra bookshelves to the family boat.
Renting is a cheaper way to live, but you’re getting nothing back from your investment. If you still want to own your own home you can still downsize and have all of the investment benefits that come along with ownership. Take a look at the market and see what’s available. It may be a decision for you that has more pros than cons.
I agree with downsizing. My husband and I plan on traveling in about 4-5 yrs. He wants to hike and I’d like to take my business on the road, plus go to different States. We plan on staying in smaller towns for a couple months or more at a time then move on.
Either way we are gathering as much information as we can now to make our adventure more cost efficient for us.
Having a big home I believe is stressful in many ways.
We downsized 18 months ago from a 2,800 square foot home, 3-car garage, and lots of storage to a 900 square foot townhouse (which lucky for us in a cold weather state has a 2-car tuck-under garage). We moved everything from out-of-state in a 6x8x16 foot POD, so we sold or donated TONS of stuff. Our expenses have been totally slashed. The townhouse (a super foreclosure deal) was paid for in cash. Our utilities are minimal (even in the coldest months, we don’t go above $70 for natural gas heat.) Our taxes are one third of what our former home was. We love this pared down lifestyle!
Changing homes incurs huge transactional overhead – money lost for good, and shouldn’t be entered into lightly.
Family size and needs vary. Gas, electric, water and maintenance costs are generally under your control regardless of the size of the house.
Depending on your neighborhood, codes, and the configuration of your house, renting out a couple spare rooms (locked off from your part of the house if so desire) may make much more sense than moving.
When you get older, you may find that you DO want more room for toys and hobbies, even if the rooms are not filled with childrens. Minimalism is great, but it doesn’t always fit everyone forever.
In our part of the world, taxes usually go UP when you “trade down”, unless you hit the trifecta of finding a livable cheaper house in one of the six reciprocating property tax counties, plus you pay huge transfer and sidewalk tax in the exchange.
Keeping a house clean is more a function of how you populate and use it, not the size. Shoes off at the door, hard tile / wood floors, no vaulted ceilings, no central air, no clutter = no mess to clean up.
Whatever you do, don’t trade into a condo. Your dues (HOA, HOD, plus special assessments) are not tax-deductible, and the costs are determined by a busybody board that will spend freely. Inter-unit maintenance is never right. Lawsuits abound. Much better to cash out your house, taking the $500k CG exemption, and rent in a deluxe complex – you don’t have to deal with the board, just the management company that wants your business, and you can leave on 30 days notice.
My husband and I had a combination of 4 homes worth of goods (between grown kids etc.) All crammed into $2,000 sq. ft.
We have downsized to 480sq ft. and we had two storage units. The past summers I have gone thru these items delivered to the grown children’s home so that I know it gets to their home not “forgotten once again” at mine. I have given to friends and family and I have donated this past holiday season we adopted 9 families (which we were able to give boxes full of great useable items bath towels , kitchen pots and pans and various other things , plus new items !) It is such a blessing to be able to pass on to others who are struggling! 480 sq ft. Is small be we are doing quite fine! Life is less stressful for sure!