Many people are reaching the point in their lives when they need to decide where they want to live when they retire. If you are a homeowner approaching this stage, you have several options to explore.
“As we see the transition of the large Baby Boomer generation age into retirement, it will be interesting to see if they move in with their Millennial and Gen Z children or if they stay put in their own homes.” (NAR)
Two options to consider….move into a multigenerational home with loved ones, or stay in your current house. Multigenerational living is rising in popularity, but it isn’t an option for everyone. For some, it’s the best one.
Downsizing
When you sell your house and purchase a smaller one, it’s known as downsizing. Sometimes smaller homes are more suited to your changing needs, and moving means you can also land in your ideal location.
In addition to the personal benefits, downsizing might be more cost effective, too.
“Many downsizers expect to improve their retirement income stream if their new home costs less than what their old house sells for. Lower utility costs, insurance and property taxes can also improve the bottom line.” (NYT)
Being in a strong financial position is one of the most important parts of retirement and downsizing can make a big difference.
A key part of why downsizing is still cost effective today, even when mortgage rates are higher than they were a year ago, is the record-high level of equity homeowners have. Leveraging your equity when you downsize can lower or even eliminate the mortgage payment on your next home.
So, not only is the upkeep of a smaller home likely more affordable, but leveraging your home equity could make a big difference too.
Bottom Line
If you are a homeowner getting ready for retirement, part of that transition likely includes deciding where you’ll live. Let’s get together to discuss your options and explore your downsizing opportunities.