words Al Woods
Moving home may hold more allure for many owners, following news of a stamp duty holiday on the first £500,000 of property sales in England and Northern Ireland until March.
Certainly, that is what the chancellor was hoping for when he unveiled the move as part of an economic stimulus package to try to get people spending to help prop up businesses and preserve employment in the midst of the coronavirus crisis.
The crisis has led many people to reassess what is really important to them and there have been reports of expected exoduses from city living to more rural and countryside locations that may provide a better quality of life.
Whilst there has been untold tragedy and challenge during the crisis, it has also led some people to pause and reflect on the benefits of a less hectic, less financially driven way of life.
Downsizing homes (moving into a smaller house) has generally been something people are expected to consider in latter years when families have flown the nest. Now, perhaps it is something more of us should consider if, to this point, we’ve struggled to meet the demands of a mortgage or rents that stretch us and, in fact, we now recognise less could be more. That is, less unnecessary space in the home, could create more space for more financial freedom and lifestyle choices.
Advantages of downsizing
The financial benefits of downsizing can be great. Your current home has likely escalated in value and with less to pay for a new home, you may buy yourself a chunk of equity and a lot of economic wriggle room.
As a smaller home is likely to be cheaper to heat and run, the financial gains will be ongoing too.
Maintenance within the home and in the garden, if you downsize that too, may be reduced, buying you more time to do other things.
Sensible storage solutions and good planning and design within a smaller home will ensure you don’t miss the space you’ve lost and will make life easier.
Challenges of downsizing
Squeezing all of your old possessions into a new, smaller home is a huge challenge and, in honesty, often not possible.
The thought of all the stuff that people have, the emotional connections to some of it and the sense that they’re not ready to let it go, is a big factor in preventing many people from taking the step to downsize.
One way to assess how many of those things you really need or will miss is to put some of them in temporary storage. This storage size guide is useful to help in deciding how much space you’d need and the cost you might expect to be associated. Storage is often a lot cheaper than people realise.
It may be that after a few months without manoeuvring around the antique desk that’s beautiful but impractical or the heirloom piano that you love but never gets played, you realise that you can part with these things after all. Deciding to sell or gift them and knowing they’re being put to better use elsewhere will perhaps bring you more joy than retaining them. Otherwise, you’ll perhaps identify a few things you don’t want to let go and you’ll be able to consider how to build those new things into your new home.
The other thing to remember is that if you downsize and redistribute equity and then change your mind and want to buy a bigger property again, it could be a big challenge. You may end up facing longer with a mortgage or, depending on your age, may not even be able to get a mortgage that allows you to buy a bigger home again.
Downsizing isn’t something you should do rashly, but it is something worth considering – whatever your age.