Thinking of downsizing your Cayman home?
What does downsizing mean in real estate?
Downsizing is simply moving from a larger to a smaller home; in terms of bedrooms, square footage or sometimes a property with less land or amenities such as a pool to maintain.
Downsizing is common for many reasons, such as the empty nesters — once children have left home. With no need for big yards, multiple bedrooms and proximity to schools, these homeowners often transition to a home that better reflects what they want out of the next phase of life.
Benefits of downsizing your Cayman home
Whether you’re retiring, you’re a recent empty nester, or you have another reason to consider moving, you may be asking yourself, “Should I downsize my house?” Here are a few key benefits of downsizing.
Downsizing to save money or time
- To fund retirement: Downsizing because you plan to retire soon or because you have already retired is common. Lower mortgage payments allow higher contributions to retirement accounts. Often people are able to sell their homes with enough equity to buy a smaller home mortgage-free with savings left over for fun and travels in retirement.
- To get out of debt: If you’re trying to get out of debt and have equity in your property, you may be able to sell, pay off your debt, and use your remaining equity as a down payment on a smaller home.
- Divorce settlement: Selling as part of a divorce settlement is also common and often allows the couple more closure on the family property, with the apportionment being agreed on as part of proceedings.
Downsizing your property suit your lifestyle
- Less maintenance: If you move from a single-family home into a condo or townhouse, you’ll minimize yard work, maintenance and cleaning time, giving you more free time.
- Move closer to family: Relocating while downsizing can reduce travel time to visit the people you care about.
- Be closer to the things you want to do: People’s priorities, interests and social circles change over time, and downsizing can make it possible for you to be closer to the activities you want to do. For example, you might move closer to the golf course or buy a smaller property with a boat dock for your Boston Whaler.
- Focus on future needs: If you’re concerned about mobility in future years, it may make sense to move from a large two-story home to a smaller ranch-style home without stairs. Or, if you’re definitely done with decorating, you could move into a brand new home.
Fizbo tips for downsizing in Cayman
Despite all the benefits, the actual process of downsizing can be tough, both in terms of the actual to-do list and the emotional impact. Here are a Fizbo’s tips for getting started.
When to downsize your Cayman home?
Here are a few indicators it might be the right time.
- The market conditions are good: Ideally, you want to sell in a sellers market, although – if staying in Cayman, keep in mind that depending on location, you will be buying into a similar market.
- You need the equity: People often decide to sell to access some of the equity they have in their home, perhaps to help fund a child’s college education, to help family with a business loan or to pay medical expenses.
- Your mortgage is unaffordable: If your monthly mortgage payment feels too expensive based on your current income, it can better to downsize sooner rather than later.
- Your lifestyle no longer requires a large space: If you no longer need extra bedrooms, a large yard for pets or a big home office, why waste more time in a space that doesn’t suit the way you live?
How to downsize your belongings
If you’re downsizing your home, you’ll probably also minimize your belongings. Focus on keeping what’s necessary and purging what you won’t need in your new home.
- Start early: Never underestimate this part and don’t wait until packing time to start purging. Take inventory what you have in the attic or garage, and give grown children enough notice so they can collect their belongings.
- Stay organized: Make an inventory list (this is helpful if you are hiring movers). Create three piles — keep, donate or sell — and be ruthless! Pack the keep pile in labeled boxes, ready for the new home.
- Measure the new home: Floor plans may be available online, or you may be able to measure up when you view your new property.
- Start with furniture: Furniture takes up the most space and is the expensive to move. Take a hard look at the layout of the home you’re moving into and only bring enough furniture to fill the space.
- Consider your lifestyle: If you’re making a significant lifestyle shift, there will be items you no longer need. Moving into a condo? Say goodbye to your lawnmower. Don’t keep things just in case.
- Digitize everything: Convert all photos, and if you still have them – CDs and DVDs into digital formats and save them on the cloud for easy access. If you don’t have the time or know-how to do it on your own, there are services that will do it for you.
Throw it out
- Expired medicine
- Badly fitting clothes
- Broken items or anything with missing parts
- Unused kitchen appliances (if you haven’t used that yoghurt make yet, you’re unlikely to)
- Oversized furniture that won’t fit in your new home
- Big items that are gathering dust (I’m talking about you exercise bike with clothes hanging on it)
- All important documents, including birth certificates, diplomas, social security cards and investment paperwork
- Valuable antiques (unless you’re ready to sell them)
- Full sets of items (keep at least one complete set of silverware, dishes and tools)
- Emergency kit (no matter where you live, keep a toolbox, stepladder, fire extinguisher and first-aid kit)
How to downsize: FSBO Fixed Fee Selling and buying (again)
Another big hurdle people face when downsizing is figuring out the logistics of selling the existing home and buying a new one at the same time. Selling with Fizbo will allow you to sell your home for a fixed-fee with no commission to pay. Using our fsbo services and fixed fee listings packages can save you tens of thousands – money to spend on your next property. What do you do if you’ve found the perfect new home, but you need the equity from your current home to purchase?
- Make an offer with a home-sale contingency: This is when you make an offer on a new house, but with the caveat that you have to sell your old home before you can close on the new home. It’s also called “making a contingent offer.” This works best in a less competitive market. In a sellers market, a contingent offer makes you less appealing to the seller than other potential buyers.
- Sell first and buy later: To simplify the process, you can sell your home with us first, we can even help you to find a rental and then assist you with your home search.
- Get a line of credit or a reverse mortgage: Talk to your bank about financial solutions that would allow you to access the equity in your home before the sale closes.
- Dip into your retirement account: Always check with your financial adviser before exploring this option, as there can be penalties.