Home > House and Home > Downsizing Your Home During Retirement

Downsizing Your Home During Retirement

By: Garry Crystal - Updated: 18 Feb 2018 | comments*Discuss
Downsizing Retirement Home Equity

Downsizing a home during retirement simply means reducing accommodation to the optimum fit for present needs. Singles or couples who are retired often find themselves with large family homes that require too much maintenance and financial upkeep. Downsizing during retirement can be a good option but there are some considerations.

What are the Benefits of Downsizing a Home?

Maintaining a large home can be a lot of work, especially if the home comes with a garden. Cleaning, gardening and home repairs are continual throughout the year and for some retirees this can simply be too much effort. There is always the option of hiring a cleaner or garden but this will incur another ongoing expense. Downsizing a home during retirement certainly won’t eliminate maintenance but should make it more manageable. A smaller home should also mean less expensive energy bills, less council tax and less money spent on repairs to a property.

Why Do Some Retirees Dismiss Home Downsizing?

Some people have lived in their homes for their entire lives. This is the place where they have raised a family, spent many happy years and there will be an emotional attachment. Many retirees also see the home as an investment and something that they wish to pass on to their children. Others are simply unwilling to go through the selling, buying and moving on process at this stage in their lives. Downsizing a home during retirement isn’t for everyone and this is a decision that should not be taken lightly.

What Are The Options for Downsizing a Home During Retirement?

Selling up and buying a smaller property is an option for retirees who own their homes outright. This option is also available to those who have a good amount of equity available in their property and for those with homes that have increased in value. Selling up can be an excellent option for retirees with a large valuable property who wish to move to a smaller property with fewer rooms. The housing market and economic climate will of course make a difference to price when buying and selling.

Are Selling and Renting Back Schemes a Good Option?

There is the option to sell a property to a company and then pay the company rent to live in the same property. But this option does come with a number of drawbacks. The money from the sale may be given as a lump sum but some companies will only pay out in monthly instalments. The sale price from the buyers will usually not be the best that can be achieved as these are designed to be quick sales. There have been reports of retirees using this scheme and paying high rental prices after the companies have increased rents.

Are Retirement Properties a Good Buying Option?

Selling up and buying a purpose built retirement flat can be a good option. Many of these properties are designed especially for those over 55 years old. The prices of retirement flats can be significantly lower than properties for sale to all age groups. This can be a good option for those who wish to downsize and be left with an amount of additional cash. The downside may be the location of the properties and the fact that there will not be a mix of different age groups in retirement blocks.

Should I Just Release Some Equity Instead of Downsizing?

Equity release schemes are popular especially with home owners who have seen the value of their properties rise over the years. Equity release schemes are basically a loan given on the home that loan companies will recover when the home is sold before or after the owner’s death. Equity release can be a good option but problems can occur with issues such as children inheriting the family home. The loan company will sell the home after the owner has died to collect their money. A partner who lives in the home may also have to find alternative accommodation if the home is sold on the owner’s death.

What Factors Should I Consider When Selling?

Selling a home can take time and there is a lot of red tape and many other people will be involved. Solicitors, surveyors and estate agents will be required and they will all come with fees. Children may not be happy about the sale of the family home although buying another home outright may help to solve that problem. There is also the fact that the money generated after selling and then buying has to last retirees for the rest of their lives. Keep an eye on similar property prices and the buying and sell market to achieve the best deal.

You might also like...
Share Your Story, Join the Discussion or Seek Advice..
Why not be the first to leave a comment for discussion, ask for advice or share your story...

If you'd like to ask a question one of our experts (workload permitting) or a helpful reader hopefully can help you... We also love comments and interesting stories

(never shown)
(never shown)
(never shown)
(never shown)
Enter word:
Latest Comments
  • Vinwake
    Re: Learning for Free in Retirement
    I am looking for somewhere in East Anglia where I can study A level English as a retired person. I need a tutor to provide…
    13 September 2019
  • Graeme
    Re: Travel Concessions for Over 60s
    I’m 64, and have just moved to a village outside Cambridge. Do I qualify for discounted bus travel in Cambridge?
    3 September 2019
  • Gordon
    Re: Clubs to Join in Retirement
    My friend is allowing me to use her email for contact. I’m feeling isolated due to my age and have been sick, which has kept me…
    3 September 2019
  • LIZ
    Re: Clubs to Join in Retirement
    Hi. There must be a few people,late 60s -70s living in or near the market town of Diss Norfolk who would like to meet new…
    31 August 2019
  • EAW
    Re: Clubs to Join in Retirement
    I will be moving to South Derbyshire in a few months.Retired I would like to find like minded people to socialise with.Maybe…
    25 August 2019
  • Franio
    Re: Clubs to Join in Retirement
    I am a recently bereaved male aged 77 and would like to be acquainted with a meet-up club in my area (Droitwich / Bromsgrove…
    19 August 2019
  • roberto69
    Re: Clubs to Join in Retirement
    i am a 70 year old very young man looking for friendship aand maybe more i am from aberdeen in scotland i hope you can publicise this
    17 August 2019
  • Magobsie
    Re: Learning for Free in Retirement
    I'd like to have a place that could be my sponsor in teaching me cake baking, even wedding cakes. I'm staying in Pretoria and…
    7 August 2019
  • Sunbeam
    Re: Clubs to Join in Retirement
    Hi, I'm a early retiree at 56 years old and my husband is 61 years old and been retired for 18 months. We would like to meet new…
    2 August 2019
  • Ronnie
    Re: Clubs to Join in Retirement
    I am a young 67 year old female who has just moved to Liverpool. I am retired and looking to meet new friends. Are there any clubs…
    31 July 2019