Rightsizing: What Is It and Should You Consider It?
As a society, we’ve latched onto the “bigger is better” mentality. Everything is big these days: big cars, huge smartphones, super-sized meals, oversized furnishings, and big homes. According to the U.S. census Bureau, the average new single-family home is 2,600 square feet, which by today’s standards may seem positively modest but consider that in 1950, larger families lived in residences that were 1,000 square feet or under.
Choosing to “upsize” is innately easy not to mention socially acceptable. It seems to just happen without us even realizing it. But we often balk at the idea of streamlining our lives by “downsizing.” Maybe it’s the negative moniker that keeps us from considering this option as something of value. So instead of using that unpleasant term, let’s refer to it as “rightsizing,” an activity that entails so much more than moving to a smaller home.
What is Rightsizing?
Rightsizing is changing something to an optimal size. This plan for life—especially your residence—is one that takes into consideration numerous factors to arrive at a solution that best fits your finances, family, and lifestyle.
It is a thoughtful process, one where we mindfully consider our unique and ever-evolving housing needs. It isn’t just about giving up are spacious family home and sorting through all of our belongings and settling for something small. It also isn’t about jumping on the “bigger is better” bandwagon we mentioned earlier just because that’s what society expects. Rightsizing can and should be applied many times in life to ensure our home is the optimal size, in an optimal place, and offers the amenities we need for our current situation.
One size does not fit everyone, especially as we move through life. Our financial situation changes. Our family gets bigger and smaller. We shift priorities. We get older. Each of these needs affects whether or not our current home still meets all of our needs.
Rightsizing isn’t just for those who are empty nesters or who need to consider whether aging in place is a viable option, though these people can benefit from the process. Rightsizing also works for those who want a change of lifestyle, to move into a different neighborhood, or even those who are crammed into a small home and need to find a residence that fits their family.
Five Reasons to Consider Rightsizing
1. YOUR CURRENT HOME FEELS TOO LARGE
The home that once was a perfect fit now is just too big. Maybe you can’t or no longer want to manage that spacious yard or clean a swimming pool that no one uses. As your children have moved out, you have multiple bedrooms gathering dust. Maybe you have a multi-level home and are simply tired of (or are physically unable to) keep going up and down stairs. Many empty nesters are happy to stay in their spacious homes but others would rather have less house to manage and maintain while for others, it simply isn’t safe for them to stay where they are. There are also young families who bought a big house and are now wishing for something cozier and less cavernous. Whatever your age, if you home feels too big, it may be time to rightsize.
2. REDUCE COST
Maybe you want to reduce the amount you’re spending on a mortgage, maintenance fees, utilities, homeowners insurance, and property taxes. Others wish to pay less for housing so they can pay off student loans or other accrued expenses more quickly. Or could it be that you’d like to be able to save money for your children’s college fund, for future travel, or to make significant contributions to your retirement? You may have new family members to support or simply want to change your financial situation from being house poor to having more disposable income.
3. LIFESTYLE CHANGE
Have you been living an urban lifestyle and crave the peaceful boroughs of the suburbs? Or have you been living in a condo or townhome and want a home with no shared walls? On the flip side, perhaps you’ve been residing in a quiet neighborhood but now want to live in a more walkable, lively metropolitan area with easily accessible amenities? After years of living in the Silicon Valley, perhaps it is finally time to find a peaceful home near the beach in Santa Cruz or Capitola. Or could it be you are dreaming of spending more quality time at home with family and friends by drastically reducing your daily commute? Each of these desires to alter your lifestyle are valid reasons to consider rightsizing.
4. YOU WANT TO UPGRADE
The rightsizing concept can include moving into a larger home, but it encourages making this move thoughtfully. If you’re family is bursting at the seams in your current home, it could be time to make a change to a larger residence. Or maybe your financial situation allows you to move from a small condo to a larger one, or even to the single family home you’ve always dreamed of owning. Again, big, small or in between, finding an optimal home is what rightsizing is all about.
The key thing to consider when rightsizing to a larger residence is whether or not you can afford it. With bigger and better typically comes a larger mortgage payment, more maintenance, higher utility bills, purchasing more furnishings, and a bigger property tax bill. Keep in mind, the amount of your mortgage and property taxes you are able to write off has changed as a result of the 2018 tax laws.
5. IT’S THE RIGHT THING FOR YOU AND YOUR FAMILY
Rightsizing your home has become necessary to accommodate changes in your family. Many of us move our aging parents into our homes or have our adult children come to live with us. These two scenarios may require a completely different house than the one you have now and it may be necessary to find a more optimal residence to fulfill this new family dynamic. Alternately, perhaps you want to help your children purchase homes of their own and to do so, it makes financial sense to rightsize and recoup the equity in your current property to assist with your son and/or daughter’s down payments.
Whatever your reason for wanting to rightsize your residence, The Dawn Thomas Team is here to help. Our years of residential real estate experience coupled with an extensive list of professionals allows us to help you smoothly navigate the rightsizing process.
Next week in our rightsizing series, we will review the benefits of rightsizing as well as financial aspects to take into consideration.