According to the National Association of REALTORS® (NAR), nearly 70 percent of homeowners over the age of 65 have paid off their mortgage, allowing them more options than younger homeowners.
With equity built up, the ability to sell for a profit is more likely for this demographic, who can then choose to spend their earnings however they choose. Here are five reasons you should consider downsizing your home this year.
1. Buy a smaller home with cash
Some homeowners will find that by downsizing, they can earn enough to buy a less expensive home in cash, and end up mortgage-free in a new abode. NAR says this is a very common route for those nearing retirement. Last year, homeowners between ages 55 and 74 who sold their home for a median price of $250,000 went on to purchase a home that was worth a median price of around $215,000.
2. Less time and money spent on upkeep
Larger family homes can take up tens of hours a week to keep up and cost more to cool in the summer and heat in the winter. Those who raised families may find that the three-story home they needed in the past is impractical now. NAR’s data supports this, showing that the median size home purchased by those over the age of 55 was between 1,800 and 1,930 square feet. This is a major downsizing from the age group of 35-44 years old, whose median home purchase size was 2,600 square feet.
3. Embrace the now
Many homeowners will find that their four bedroom split level was great for raising a big family, but now they tend to use their home for weekend visitors and casual get-togethers. The right home for this new lifestyle may be an open floor plan that includes guest quarters and attached bathrooms instead of many smaller bedrooms and bathrooms. Last year, NAR found that homeowners over the age of 55 had a median of three bedrooms and two full bathrooms. Great rooms also tend to replace living rooms and dining rooms — and larger, eat-in kitchens are common to save space and keep the floor plan open.
4. Look forward
Last year, NAR reported that 13 percent of buyers over the age of 50 purchased senior-friendly homes or units in active senior communities. In many cases, then, this age group is not only planning for the “now,” they are also planning for the future. One-level homes with open floor plans, larger rooms and wider hallways prove to be great not only for entertaining guests, but they also will be wheelchair and senior accessible in the future.
5. Gain flexibility
Last, and perhaps most importantly, it’s finally your time to choose. By selling your home, you can regain the flexibility you gave up as you pursued your career and family aspirations. Many approaching retirement in Lexington and Central Kentucky are looking at a downtown condo and a summer rental out of state. Others are looking at townhomes with modern conveniences and a homeowner’s association that handles basic yard and sidewalk maintenance. Still others are wondering if it’s time to retire full-time to the lake home that has been a precious summer escape.
Now, unlike any time previously, you can make the choice that best suits you, and no one else!