While downsizing is typically the domain of the retiree (or soon to be retiree) perched at the top of the property ladder in large accommodations, with high real estate prices, a growing desire to live in proximity to amenity-rich areas and, well, the reality that COVID-19 is prompting many of us to revise our lifestyle decisions and work/life balance, a commitment to minimalist living has growing appeal across multiple demographics with varying goals for downsizing.
For instance, there is a trend for people selling a home in which they have accumulated a great deal of equity and splitting that wealth into two smaller homes (i.e. city home/country home).
There are also changes to living arrangements trending, with retirees seeking smaller space where they may only live full time (i.e. snowbirds, children in university with whom they would stay while visiting the city for health care, cultural experience, shopping, visiting etc.).
Downsizing, particularly to a condominium, means living turn-key, which is beneficial for many people. And downsizing doesn’t have to mean sacrificing or compromising - rather it is a move that opens your lifestyle up to new opportunity.
But, how do you know when it's time?
Downsizing: The Numbers Stats
While the shift towards downsizing has largely been lifestyle-driven of late, there have been some interesting trends specifically among Boomers over the last couple of years regarding downsizing residences.
While many boomers are choosing to age in place, there is still a swift movement of retirees trending towards selling out their larger homes and moving to smaller homes. Of those moving to smaller spaces, condos are the property type of choice.
This 2020 report from Sotheby’s International showed that among older homeowners in Toronto, 51 percent intend to sell their homes and buy a condominium.
Boomers do seem to be downsizing later in life compared to prior generations, according to recent statistics. This is in part because adult children are staying at home for longer, given the high price of rent and/or homeownership in relation to income typically at the beginning of career progression. They are also saddled with monstrous student debt in most cases, so they are staying in their family homes longer.
According to this 2018 survey from Royal Lepage, boomers in Ontario were most likely to consider downsizing with a new home, compared to the rest of the country. Nearly half (46 per cent) said that they favoured condominium living.
According to this 2018 Ipsos Reid Poll, 18 percent of respondents aged 55+ had already downsized; 34 percent indicate that they wish to do so in the next five years. Of those downsizing,
And surprisingly 32 percent of respondents who intend to downsize admit that they aren’t really sure about the costs associated with downsizing (I’ll explore this further below).
Notably, the overwhelming majority (91 percent) of those who have already downsized are happy with their new homes and living arrangements.
Like with any move though, happiness comes with strategy and planning ahead.
But.. how do you begin?
Benefits and Challenges of Downsizing
As with any real estate purchase, there is an upside and there is a downside. One of the good aspects of downsizing is taking equity out of your current home, freeing up your wealth and cash flow.
Moving into a condominium living can also help you to better anticipate your costs, which is helpful to plan and manage your wealth, no matter what stage of life you are at.
Living smaller means living more simply. There is less time required to clean and maintain a smaller space. You’ve got more time to devote to other activities or to travel. It’s a win for work/life balance- even if that work is home maintenance!
Downsizing means purging your belongings, which for many people is cathartic and stress-relieving. “Stuff” can make us feel overwhelmed and a major purge of material goods can equal a fresh start.
Owning a smaller space means less energy use, which is cheaper from a management standpoint and is better for the environment.
On the other hand, smaller doesn’t automatically equal cheaper. While moving to a smaller space will likely reduce some of your operating costs (utilities + taxes) and your overall maintenance and repair costs, depending on where you are moving, you may incur additional costs, like incurring condominium common fees. If your reasoning for downsizing is purely financial, you may even consider renting a smaller space as an option. Either way, make sure that you do all the math before you proceed.
A condominium will have common fees that - in some instances - can be quite high should the building have a concierge, a swimming pool, or a host of amenities which you may, or may not, use. At the same time, the common fee will include expenses associated with landscaping, and snow removal, as well as building insurance which you may already incur owning a house.
Recognize the emotional attachment that comes with owning a home. Does a large home = status to you? Will you be able to rectify that if you move to a smaller place? Similarly, having a smaller home means having to pare down on your belongings. How do you feel about that? Are you ok to part with some (or a lot, depending on your situation) of your stuff?
Obviously, a smaller space means having less space to live in. Is there enough room to be comfortable, in terms of privacy and quiet time, if needed? Are you a host with the most? Would a smaller home allow you the ability to host guests for meals and/or overnight?
Contemplating challenges before they occur can help ease a transition. For more tips on how to navigate this transition happily, this article by The Simple Dollar: “The Challenge Of Moving To A Smaller Home”
The Downsizing House Hunting Wish List
I’ve worked with a number of clients downsizing over the years, and while wish lists do vary, there are some common elements:
• A separate kitchen beside the entertainment space so the food preparation mess can be contained or, if the kitchen is open plan, it has a half-wall so the dishes, pots and pans are out of sight from the dining table.
• A kitchen with a breakfast area
• A separate, formal dining room that can accommodate extended family for birthdays, celebrations and holidays.
• Bedroom doors which close fully for privacy and sound isolation as opposed to sliding barn style doors which are quite commonly found in many newer condominium buildings
• A split bedroom floor plan - featuring equal sized bedrooms with ensuite baths - ideal for hosting family or friends or for couples who prefer to sleep in their own beds (oh that snoring that comes with age)!
• A living/dining entertainment area which is sufficiently large for dining furniture (don't forget the china cabinet!) and living area seating to comfortably accommodate 3 or 4 couples
• Abundant natural light and good sightlines
• A suite that is well situated in the building - preferably on a lower floor for ease of access in the event of a power outage or emergency
• A guest bedroom with ensuite bath which could serve to accommodate a family member or caregiver later in life, allowing them to "age in place"
What most of these features and design elements do have in common is that these qualities and configuration mimic house-style living. Downsizing doesn’t mean sacrificing if you find a space that suits your needs and your new lifestyle objectives.
Possible Downsizing Deal Breakers
On the other hand, this buyer segment commonly has a list of downsizing deal-breakers as well. Some of the ones that I hear most often are:
• Affordability awareness: how much will the sale of our existing house bring, and how much property can we next comfortably afford?
• Relative scarcity of both freehold bungalows or one-level condominiums. Is current stock suitable, desirable, and of utmost importance, available
• Keeping an eye on the horizon: is construction in the immediate area currently underway or in the planning stages? Part of our due diligence as your realtors is to provide perspective on any mitigating factors that could affect your enjoyment of a next home, including if any new development will affect the amount of natural light or your view and sightlines.
• What factors might interrupt your peace and quiet? How close are those train tracks, and how often do those trains run? Is the nearest arterial road busy at all hours with public transit or trucks? Will these impediments keep you awake at night? We explore how all modes of transportation may impact your quiet enjoyment!
• There may be deal-breakers within a condominium complex. For example, is the suite adjacent to the fitness room with the heavy weights that might be audible at night, or is the chlorine from the pool also in the common hall? Is the suite directly across from the elevator where the bells might disturb you? Is the suite next to the garbage chute? It's critical to be cognizant of all potential factors which could be problematic for you before making that move.
While at other times in your life, you might have been more willing to compromise on your wish list, remember that you are also reconciling a jump down the property ladder, which takes an adjustment to transition to. Having elements present like those listed above could put extra undue pressure on the transition.
Design Tips for Smaller Spaces
Once you’ve decided to downsize and have found just the right place, how to make the most of your smaller home?
One consideration when you are downsizing is how you will furnish and decorate. It’s not as easy as taking your furniture from your old place, getting rid of some of it and then using what’s left over in your new space. It’s smart to avoid clutter and to have appropriately sized furniture and accents to make the most of your new space.
Before you move, decide what you can live without and what you absolutely will need. To get perspective, compare measurements of your current rooms with measurements of your new rooms. Draw out a floorplan for each room to consider realistically if certain pieces will work or not.
In many cases, you can successfully merge a selection of your current pieces with new pieces to combine the familiar with what will let you be most comfortable and amplify the sense of space in your new home. It’s not a bad plan to purchase furniture and accents a little bit at a time so that you can get used to things over time.
Avoid clutter and over-crowding rooms with furniture. Avoid things like overstuffed sofas and chairs. Storage is at a premium in smaller homes, so if you can create more storage with your décor (i.e. furniture that does double duty (ottomans that lift up, night tables that open, built-in shelves, in-closet organizational systems etc.).
In the kitchen consider rolling storage and keep items on the countertop to a minimum. A floating spice rack is a great space-saver.
Choose light colours wherever possible. While dark colours are dramatic, they can make a room feel smaller. Consider extras like installing a stretch ceiling with reflective properties, which distributes the light in such a way that makes a room seem taller.
Avoid heavy window treatments. You need natural light flowing in to create that sense of space.
For more tips, read 6 Tips for Downsizing and Must-Know Downsizing Tips for Your Move to a Smaller Home.
Looking to downsize into a condomium? Find out where the market's at right now under the shado of COVID-19, and, given the effects of the pandemic, what you can expect to find product- and price-wise in Toronto as of December 2020:
I’ve written about downsizing a few times over the last few years, counselling clients on how to successfully move down on the property ladder. Check out Dear Urbaneer: Is It Time To Downsize My Property?, Downsizing: The Challenges Of Finding A House Sized Condominium and How To Successfully Navigate Downsizing Your Home.
If you're exploring alterante living arrangements and models that could work well for your family, or have parents in a retirement community or long-term care facitlity, you may find this post beneficial:
With COVID-19 Outbreaks In Long-Term Care Facilities, Is Multi-Generational Housing Better?
And if you're not certain that combining family units is for you, it would be a boon to read this piece:
How To Decide If Multi-Generational Housing Is A Good Fit For You.
Can the personable engaging and service successful Urbaneer team become the realtors of choice for you or someone you love? We'd be delighted to guide you in securing the best of the best Toronto real estate.
With a multi-disciplinary education in housing - and 28 years of experience in the property market - Steve and his team believe the search for a Home requires engagement on sensory, intellectual and emotional levels. In fact, it's how we've become top producing realtors.
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Steven Fudge, Sales Representative
& The Innovative Urbaneer Team
Bosley Real Estate Ltd., Brokerage - (416) 322-800
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