If you are thinking of moving and downsizing, now is the time to start the house hunting process. Majority of the country is experiencing a sellers market. In a recent blog by Dave Ramsey, a financial guru, he states 3 financial pros for downsizing right now.
- A smaller home means less time, money, and stress on upkeep of your larger home. It also means less space.
- You could use the proceeds from selling your current house to pay cash on a smaller one. That could relieve the stress of a mortgage! If this is unattainable, figure out a mortgage that is affordable and doesn’t put a hole in your pocket.
- With a smaller house, let’s assume you save about $500 per month on your mortgage payment. In around 30 years, that is an extra $1 million in the bank!
Realtor.com posted an article talking about what sorts of questions you should ask yourself when downsizing. Here are a couple of things to ask yourself.
Q: What should my buying budget look like?
“A: If you’re planning to retire soon or have already entered those coveted golden years, you’ll likely be on a fixed income. Downsizing might net you a decent profit, especially if the home you’re buying next costs considerably less than the one you’re selling. Consider other expenses as you age: medical bills, health and life insurance, travel, estate planning, final expenses, and home maintenance. The common rule of thumb: Spend no more than 30% of your monthly income on housing. But in theory, it should be a lot less if you’re downsizing.”
It is always important when discussing moving to discuss your budget. Always have a top budget in mind. When working with a realtor, make sure they are aware of a budget that you are comfortable with. When downsizing, you may make a decent profit from selling your current. This is true if your downsized home costs considerably less than the home you are selling.
Q: Have I built up enough equity in my current home to make a profit?
“A: For most homeowners, the answer is yes. This is if they’ve held on to their properties long enough to have positive equity that will be sizable enough to put a large down payment on their next home.”
If you are not in any type of debt, you should see a nice profit when selling your home. This can help you with the down payment on your downsized home.
If you are debating on downsizing to a smaller home, we are here to assist you. At The Brunner Burkhart Group , we are happy to evaluate your options and guide you in the right direction. Any of our highly-qualified agents can assist you in finding your next dream home!