The average size of a house in Canada in 1975 was 1,050 square feet, in 2010 new homes being built almost doubled to an average of 1,950 square feet. While Canadians still may dream of a large home, trends in home ownership may actually be heading in the opposite direction and older Canadians are choosing to downsize. There are many reasons why you might want to decrease the size of your home; they may be to adjust a reduced income, don’t work the worries of home ownership, or you may just want to have more money to enjoy yourself.
Are You Planning to Downsize?
There are limitless possibilities for you in Canada. You may consider going to rural Canada and acquire a cabin on the ocean shore. Alternatively, you could consider getting a condominium and enjoy all the amenities including a fitness center and swimming pool.
However, there is one concern: downsizing doesn’t always turn out as you anticipated. I remember of a longtime friend who was sure of getting an extra $270,000 after getting a nice bungalow in British Columbia. Sadly, he only got a partly $83,000 and this seems to be the general trend for many other downsizers.
This is not to imply that downsizing is always a flop. With the right approach, you can free-up many funds and enjoy your retirement to the fullest-community work, traveling the world, volunteering and so on.
Here’s why downsizing could work for you.
An Opportunity to Pay Less
A mortgage is the highest monthly expense most Canadians will ever incur and lowering it can be the best reprieve. Downsizing your home can have a sizable effect on your mortgage. Consult your mortgage broker in Canada and see if you qualify for porting, knowing that lending guidelines are very strict nowadays.
Benefit of Smaller Living
A larger home may have space and other things to die for, but this comes with a need for upkeep. Are you yearning for a streamlined life free from stress? This is something you can achieve by downsizing to condominium in a quieter place.
New Lease of Life
Though mine was not downsizing at all, I know how it feels to breathe new air after living in a neighborhood for over ten years. Your older children may have started their families or your spouse may have died. You might want to downsize to a smaller home in a location where you can associate more with other homeowners.
Are you ready for a new chapter in your life?
Be Honest about the Decision
When you are downsizing, the most important thing is to plan. Part of the plan is to review the motivation behind the move. Do you have practical or financial reasons? Do you want to move closer to your relatives because your spouse has died? Are you a frequent traveler and you think spending money on the family home does not make sense? Each of these is a good reason to downsize as long as you are psychologically and financially ready.
Choose Location Carefully
Have you always had the dream of living in an isolated community near the lake? Are the amenities of the city more valuable to you? Experts argue that it may be wise to try out the new location for say one year before making a permanent move. This will allow you to access the weather, cost of living and such things.
Though downsizing is very tricky, it can turn out to be one of your best decisions. If you are looking downsize with a smaller home, or if you want to stay in your home, and have more money at your disposal, may want to look into a Reverse mortgage. To assist you in making an informed decision, speak to a professional and experienced mortgage broker for the best advice and get best mortgage rates. You just need to make sure you have a concrete plan and your expectations are in check. There’s more to learn on this topic at Ratestead.ca.