I’m going to be talking about advantage and disadvantages in downsizing house or moving to smaller house. I will be covering some advantages as well as downsides and summarizing whether one should move or not.
You may have a large house, but now the children have perhaps moved out and you’re rattling around in a large house by yourself or with your partner. You still have to pay the bills, you’re still paying the council tax, the mortgage is still there, you’re paying for utilities and you’re still trying to maintain the property.
Let’s look at the advantages and disadvantages of downsizing house or moving to smaller house
Advantages
Let’s look at some of the advantages. One of the advantages could be “financial gain”. You could gain quite a bit of equity from your property. Say, for example, you had a 5-bedroom property and you downsized it to a two-bedroom property, you could gain a significant amount of equity from that property. You can use that equity for a retirement plan or you could even consider when you eventually pass on to leave something for your children.
In my opinion, brick-and-mortar is one of the best investments that you can get a return on investment. However, when your downsizing house you’re diversifying your portfolio and as a result, you are effectively limiting the risk of the house value drops in the future.
Another advantage is “lower running costs; a smaller property can significantly reduce your outgoing cost. That’s lower maintenance costs, lower utility costs and lower mortgage costs.
Disadvantages
One of the disadvantages could be “fees”. You could incur agency fees when you’re selling your property and also you can incur conveyancing fees which are legal fees that are involved when you’re selling a property as well.
Another disadvantage is “memories“. What do I mean by that? Memories you would have, many memories of staying in a house you’ve been there 10 years, 20 years. It could even be 30 years. You’ve shared so many ups and downs, you’ve cried, you’ve loved, you’ve seen the children grow up, you and your partner have grown old together, you have so many memories that are irreplaceable, so one of the disadvantages is obviously if you downsize the property then you will lose those memories which you cannot regain from another property.
Another disadvantage to consider is “reduced space”, you may have been used to a certain amount of space and in this time you would have accumulated many different items, lots of belongings, so as you reduce and downsize your property you now need to find a new home for those belongings. You may have to change your furniture, you might have to sell your old furniture because the old furniture cannot fit in the new place and you might even have to buy new furniture to accommodate the new space so those are other things to consider as a disadvantage.
To move or Not to move?
is the question. Now, this is really entirely up to you. You have to make a decision if the advantages outweigh the disadvantages on downsizing property and you’re happy with your choice. You also have to remember that once you have moved it may be difficult or even impossible to move again so once you’ve downsized you’ve got rid of all your things, you’ve reduced all your belongings, you’ve bought new furniture, you’ve got a smaller place you no longer have the equity because you’ve used that equity to buy the new place it may be actually impossible, very difficult to move back or to reverse the process.
So, to sum it all up, it is wise for you to make the correct choice at this stage and make that decision final. If you’re thinking of moving to downsize, upsizing or selling your property or releasing equity from your property or even refinancing, feel free to contact us to see how we can help you.