A white-picket fence, sprawling backyard, big, beautiful home… these are just some of the idealisms of the so-called American Dream we’ve all come to know. However, this American Dream could very soon become a thing of the past. As today’s homeowners are realizing that bigger isn’t always better, there is a new push for downsizing the way we live – starting with our homes.
From HGTV to lifestyle magazines and design blogs, you may have heard about concepts like compact living, small space homes, and even tiny houses that are gaining traction with homeowners of all ages – especially retirees. For retired homeowners, these smaller abodes present all the benefits of downsizing, coupled with a simplified lifestyle approach. In fact, according to industry estimates, as much as 40% of the market for tiny houses is made up of homeowners over the age of 501.
Even if you’re not quite ready to commit to the tiny-home life, (typically just 100-600 square feet in size!) considering a simpler, or smaller home to downsize to presents numerous benefits.
Save Money & Lower Costs
It goes without saying that smaller homes typically come with lower purchase prices and ongoing costs. And in today’s inflation-ridden market, these savings are a major driver in the trend toward simplified homes. Not only do smaller homes boast more manageable mortgage payments, but they also present savings opportunities via taxes, maintenance, furnishings, and other interior décor. After all, the smaller the house – the less “stuff” you need to fill it with. What’s more, today’s smaller homes are often more energy efficient because they have less space to heat and cool – resulting in a lower ecological footprint and savings for you.
So, just how much can you expect to save by downsizing to a smaller, simpler home? While the totals vary by area, homeowners in the country’s top 20 metro areas can expect to save about $194,000 from downsizing from a four-bedroom home to a two-bedroom home2. Ka-ching.
Smaller Family = Smaller Home
Now that the kids have flown the coop, you may find yourself an empty nester. And while your home once served all the hustle and bustle of raising children, it may now feel… well, a bit empty. This feeling is why so many senior homeowners opt to downsize upon retirement. Simply stated, a smaller family requires less space, and therefore presents the opportunity for a smaller home.
Rather than looking at downsizing to a smaller home through the lens of a “downgrade,” instead consider all of the benefits, especially when it comes to family. As compared to large spread-out floor plan homes, a smaller environment encourages more family bonding and interaction. Smaller homes also create a space for family members to get organized and make the most of a cozy space. After all, with a smaller sized home, you can’t help but become closer to your family!
Shift in Mindset: Embracing Minimalism
Besides some of the obvious benefits of downsizing a home, there’s another driving force behind the smaller house movement – the changing mindset of American homeowners. After decades of a society driven by “bigger is better” and consumption-based living, the tide is turning away from large, filled homes and more toward simplified, practical, livable spaces. You know how the saying goes – “less is more.” This sentiment is a hallmark of the growing minimalism movement. After all, the idea that having less space and stuff can create room in your life for more important things, is a very appealing one. And with TV sensations such as “Tiny House, Big Living,” and “Tidying Up with Marie Kondo” captivating viewers, it’s safe to say that minimalism is gaining momentum.
While cleaning, maintaining, furnishing, and taking care of outdoor chores around the home all come with costs, our homes can quickly become very stressful. Downsizing into a smaller, simplified home can be the first step to mitigating this stress in favor of a minimal and streamlined lifestyle.
Less Maintenance, More Time
Our homes are a labor of love. And as a homeowner, there is no denying the amount of time, energy, and effort that go into maintaining a home. Fortunately, downsizing to a smaller home can require less of your time, energy, and effort in doing so. With fewer rooms in a smaller home, you’ll free up more time previously spent on cleaning. Better yet, the home’s smaller size can also help you to cut back on clutter around the house. The result? More time for leisure activities, spending time with your family, getting more rest, or quite simply – more of the things you love!
Opportunity to Start a New Chapter.
As you near or settle into retirement years, downsizing your home can mark the start of a new chapter. A new home also presents an opportunity to start a new life and embark on new memories. And without having to live near a job or school system, downsizing presents endless opportunities in terms of location.
Relocating to an area that better suits your hobbies is also a huge perk. For instance, if you consider yourself a beach bum, you may opt for a condo or home along one of the nation’s waterfront coasts. Like history? You may find yourself gravitating toward Northeast cities rich in history, such as Philadelphia, Boston, New York, or Washington DC. Want to spend more time with family members? Consider a home in a nearby community for ample time snuggling with the grandkids and enjoying quality time with relatives. Wherever your retirement haven may be, check out some of the characteristics of great places to retire, here.
Ready to embrace simple living? You’re in good company. A study from Trulia shows that more homeowners express their desire to move to a smaller house than a larger one3. For more information on downsizing to a simpler home, check out our do’s & don’ts, here.
If you’re ready to downsize into your retirement haven, a HECM for Purchase can help you buy a new home without monthly mortgage payments4. And no, it’s not too good to be true! Designed for homeowners ages 62 and older, a HECM for Purchase loan helps you accomplish two goals in a single transaction – buying a new home while securing a reverse mortgage. A popular option among seniors, a HECM for Purchase can save you money by reducing closing costs since a single loan is taken out. This can also make the home buying process faster and easier.
Want to learn more? Read more about HECM for Purchase, here. And for more information, contact the Longbridge Financial team of reverse mortgage experts today.
