More Baby Boomers Are Putting Up Their Homes For Sale in Favor of Downsizing to a Smaller Home: Here’s Why
As baby boomers reach retirement age, many are considering putting their homes for sale in favor of moving to a smaller, more easily-managed home. In fact, researchers in a recent study by Edelman Berland found that 33 percent of homeowners who are thinking of selling their homes are also thinking of downsizing when they buy a home again. The reason for this is mainly due to the following benefits of downsizing:
Empty Nest to Cozy Home
More and more baby boomers are finding their homes are simply too large for them as they get older and their children move out of the home. Larger homes need more attention than their smaller counterparts, both in maintenance and in cleaning. As their children move out, they are finding it harder to keep up with, (especially because they do not have their children to help with home maintenance and other housekeeping!) A smaller home and yard are easier to maintain. By downsizing, baby boomers are also reducing the empty nest feeling that a large, but empty home can cause.
Often, downsizing a home also means lowering the monthly payment, if not getting rid of it completely. Homeowners can apply the difference in payments to their newer mortgage to pay it off more quickly. The reduction in a mortgage payment means many baby boomers are able to tuck more away for retirement. These savings can also help reduce the strain of living on a fixed budget. Additional savings can come from reduced real estate tax bills.
Freedom From Mortgage Payments
A huge benefit to downsizing is the option to use the money from selling your larger home to pay for a smaller one in cash. According to a recent study by Fannie Mae, only 37 percent of homeowners feel they have enough equity to make money when they list their homes for sale. However, that same study showed that 69 percent of homeowners actually have the equity to make a profit. Meaning, more people are able to do away with the mortgage payment altogether and free up a large chunk of the monthly budget, allowing boomers more options for retirement. And in a competitive market, having a cash offer can sometimes trump a higher offer with a buyer mortgage.
Another popular option for boomers wishing to downsize is to split the profit from the sale of their older home between a smaller home and a retirement or vacation home in the area they plan to retire. By doing this, working boomers can continue to live near their jobs, while enjoying a vacation home. Once they actually retire, boomers then have the option to place one of their homes for sale or rent it out while enjoying retirement in their ideal location.
To learn more about the benefits of downsizing, both for boomers and other homeowners, or to find out about homes for sale in the Wayne, PA and surrounding areas, please contact the expert staff at Sage Realty at