Thinking about Downsizing? Now is the right time.

This guide will help empty nesters decide if downsizing (or right-sizing) is the right choice. We will also explore the main reasons why empty nesters choose to keep their home, and the alternatives that exist for homeowners contemplating a move. Lastly, we will share our opinion on the feasibility of banking on your home equity for retirement.

We don’t like to use the term downsizing, because it carries negative connotations, instead we use the term “right size”. Right sizing happens at all stages of life, and for dozens of different reasons. Some families are moving to larger homes, because their families are growing, and other families are moving to smaller homes, because their children have moved out. Recently, empty nesters have been holding their homes for longer, and in some circumstances that is counterproductive to their goals.

Your family home is...

A home means different things to different people. For empty nesters, their home means security. It’s where they raised their children, it’s in a community they know, and it’s familiar. But sometimes a home means more than security, it also means power, because it was your dream home all those years ago, and now it’s still a symbol of having “made it.” It’s because of people’s emotional connection to their home that we use the term rightsize, instead of downsize.

Needs change, and priorities should change too.

We live in an ever-changing world, and we need to adapt to changes if we want to live comfortably. If there are rooms in your home that you are not using, your home is probably too Large. Large homes take a lot of time to maintain, and cost more in hydro, water, gas, and taxes. Large homes are also worth more money, but you can’t count on house prices staying high.

Is your home your retirement savings?

Baby boomers have seen their home’s equity quadruple. It’s unlikely any other generation will be as lucky in the housing market as our baby boomers, but it’s important to not bank on prices remaining high. While empty nesters are holding their homes for longer, if there is a hiccup in the market, they will exit the market to protect their retirement savings. The influx of new listings will saturate the market, and prices will drop further. If you cannot handle your home’s equity dropping, it’s a good idea to downsize and reinvest the money elsewhere.

If there is a hiccup in the market, our empty nesters and baby boomers are the most susceptible to unrecoverable financial loss.

Reinvest your money somewhere it works

If you sell your home and have equity left after the sale, consider reinvesting it with a professional portfolio manager. A diversified portfolio, managed by a professional, reduces your risk of loosing your retirement savings in real estate, or a single stock. We have connections with some of the top portfolio managers at Wood Gundy, who can help secure your retirement.

Where would you go?

Rightsizing is a huge decision. Do you stay in the same community? Do you move to a bungalow, or a condo? Do you buy or rent? We help rightsizers find the right community, and the property type that suits them. Rightsizing involves weighing the benefits and drawbacks of different house types, and we can help you realize your top priorities, and where you have flexibility.

Personally, I'd rightsize here

We both love 11 Bronte Rd. It’s a fantastic condo that’s very popular with working professionals, and retirees. The condo has first class amenities, fantastic floor plans, and the most amazing views of the lake and harbor. The maintenance fees are very reasonable, and you have unlimited access to the amenities, which are found on the roof. The amenities include an outdoor pool, hot tub, gym, and a gas-heated observation deck.