Thinking of downsizing? Downsizing is a process that requires making many rational decisions but with an emotional mind. Where to move to? What communities will be suitable? What can I afford? Who can help with decluttering my current home? The following is an overview of some elements that come with downsizing.
Reasons for downsizing
The reasons for downsizing depend on many personal factors. For many, there is the emotional desire to live smaller now the kids are gone. Maybe the home is too big and comes with the burden of maintenance, in and around the house, cleaning and high energy bills. Sometimes finances or health issues are reasons to move to a smaller home.
Downsizing is a process
Whatever the reason for downsizing is, most people have the thoughts of downsizing for some time, even several years. Downsizing is clearly a process that requires many actions and decisions. With those decisions come fears and often procrastination. Everyone’s home is filled with memories, and one should never underestimate the emotional rollercoaster that comes for many people during this process of downsizing.
Important decisions for downsizers
Since many have the process of downsizing lingering in mind for some time, many already have a fair sense of options, as well as requirements, wishes and communities in mind for a new home. Most don’t decide overnight. Many important decisions need to be made. For example:
- Which community suits me?
- What type of property is best? Will an apartment suit me?
- Should I sell my current home first or buy a new home first?
- What can I really afford? And what are other costs involved?
- How much space do I need?
- Can I get help to de-clutter my current home?
- What do I need in a new home, and what do I want in a new home?
- Should I sell and start renting?
Help in making choices and exploring options for downsizing
Following is an overview with some pointers that may help in lining up some important questions to consider to help downsizers.
Choosing a community
Calgary has more than 200 communities so, for most, it is important to reduce them to a few options. While driving around, get a sense of buildings out there, ask other people who live there for their personal experiences. Most people prefer to stay close to family, friends, church, clubs, supermarkets, etc. Easy access to those destinations is important to explore.
What neighborhoods offer the necessary amenities? Do you want to be close to friends, family, perhaps your family doctor, shops, public transport? How about access for pursuing your favorite hobby? Where is the nearest golf course, curling rink and library?
Many downsizers already have potential communities in mind, based on the above. However, the community also needs to offer a suitable type of property.
For a more detailed overview on how to choose a community, read the post about finding your community.
Nearby transportation
Transportation is important. Having and driving a car is a privilege. However, the future can change and at some point, public transportation may be needed. How accessible are the bus and C-Train routes?
Personal needs and wants
Needs and wants are very personal and different for every individual. One can look at the minimum space requirements in square footage and the number of bedrooms. Although most people only need one bedroom, some want a second bedroom for guests or crafting, for example. Furthermore, amenities need consideration. A unit on the third floor in a building without an elevator may not work. Or, at some point in the future, health issues may prompt having a live-in caretaker who requires some space. It is important to see the difference between wants and needs. Most likely, the needs are of higher importance than the wants, especially if one has health concerns.
Types of property
Calgary offers a variety of property types and styles. Every type of property, both condominiums and single-family homes, are available at various price ranges. Are you coming from a luxurious lifestyle and prefer a penthouse? Calgary makes that possible.
Many downsizers choose a condo, be it an apartment or townhouse. Condo fees are always part of condo living. However, condo fees do replace many costs that a single-family home requires, as well. Think of landscaping, snow removal, outside maintenance, and insurance. Those costs come with a single family home but are usually included in condo fees. A single family home gives other advantages and disadvantages. Much will depend where one is coming from and what the individual needs are.
Pros and cons of different types of property
Every type of property has different pros and cons for downsizers.
An apartment in a building often comes with great amenities. Elevators and heated underground parking are generally necessities when downsizing to an apartment building. Furthermore, many buildings in Calgary offer a fitness area, some offer a swimming pool, etc.
Also, condos may be safer when lots of traveling is on the agenda. One footnote is required here, though; more and more insurance companies also want apartments checked by someone while the owner is away.
An important point regarding apartments is the allowance of pets. Not all condo boards allow them.
A townhouse can be a good in-between step for a downsizer from a large home. The living area of a townhouse is generally smaller, and the condo board takes care of a lot of the maintenance. One downfall with a townhouse may be the stairs. While some people say that stairs keep them in better shape, these do need personal consideration. Regarding the stairs, in many cases installing a chair elevator is an option, if needed in the future.
Calgary offers many townhouses with an attached garage, an essential feature for many downsizers. One other advantage of a townhouse is the fact that many townhouses have a tiny yard or patio for some enjoyment outside. Also, condo boards of townhouses tend to be more lenient towards owning pets. Townhouse complexes, though, tend to offer fewer amenities, such as a gym, than apartment buildings.
Villas are also a perfect option for downsizers. The layout of a villa is much like a bungalow but with the garage attached. Usually, bedrooms, bathrooms and laundry are all on the main level. Many villas still have a basement, but one can leave the basement unused and avoid having to take any stairs. The condo board takes care of most of the maintenance. Many of those villas in Calgary have larger outdoor spaces such as balconies. (foto)
If coming from a large home, and still being fit, a bungalow may be a good option for a downsizer. A bungalow usually offers a yard for a veggie patch and some gardening therapy. Most bungalows do have a garage. And, importantly, many bungalows give the option of having everything on one floor: bedrooms, bathrooms, laundry, etc. Although a bungalow still has a stairs to the basement, in essence, the basement can be left unused. Pets are always allowed in bungalows because they are single-family homes, and there is no condo board involved. Maintenance, landscaping and snow shoveling may need to be serviced out at a higher cost, though.
50+ and 55+ buildings
Calgary offers many condo complexes with the age restriction of 50+ or 55+. Keep in mind that starting 2033, only 55+ will be allowed. This means that purchasing a unit in a 50+ corporation may eliminate the age restriction altogether in 2033. Read more about this subject in the future of adult living in Alberta.
These age restricted complexes often offer many amenities such as craft rooms, social rooms, organized gatherings and even field trips.
To see what is currently available in Calgary for 50+ and 55+ follow a button.
Explore the locations personally
While searching for a suitable place, the MLS offers essential information such as location, size, number of bedrooms, condo fees and what is included in those fees. It also shows the home with photos. However, photos never tell the entire story. Therefore, always visit locations at several different times of the day and/or evening. Check the amenities and visit the social rooms to make sure they suit and meet any expectations. Also, people love to share their experiences, so always talk to people who already live in the community or condo complex.
Buy first or sell first
For most people, the financial situation is a first step to explore because many decisions in the downsizing process depend on financing. Also, this process almost always gives the answer to the question of selling first or buying first. The timing of selling is important, and much depends on the current real estate market Calgary is in. A buyer’s market usually means it is more difficult to sell your home. In a seller’s market, it is usually more challenging to find a suitable property than in a buyer’s market.
Types of mortgages
For some, it is possible to get adequate money out of the proceeds of the sale to finance the purchase of a new home. Others may have enough savings to purchase their next property. If this is not the case, then financing options need careful attention. Lenders are not allowed to practice age discrimination. This means that if one has enough income, for example, out of old age security or a pension, these income streams can become part of the mortgage. Besides a conventional mortgage there are two more options worth looking at:
- Bridge financing. Also known as bridging loan, an option to use when one buys a property first, before selling the current home. It is a temporary mortgage to cover both mortgages until the funds of the sale are received to pay for the new home. Lenders bridge this gap for a few months, yet at a higher interest rate. It is important to talk to a lender about the options and cost of bridge financing.
- Chip mortgage. While this article is about downsizing, we’d like to point out the potential of a chip mortgage. When you are 55 years or older, a chip mortgage allows you to get up to 55% of the equity of the home. A chip mortgage is, in essence, a reversed mortgage that comes with very specific rules. The big advantage is that one doesn’t have to move and is able to stay in the current home. The disadvantage is that reversed mortgages are very expensive, usually several percentage points higher than the regular interest rate. A chip mortgage is repaid when the owner passes away, or moves out to, for example, a care home.
Ask for a free monthly Market Report
When selling, a good start is to request a home evaluation. Request a monthly report of all sold data, including home features, number of days on the market and the ratio list price vs selling price. Sold data is a great way to understand the real estate market in your community.
Renting instead of buying a home
Selling the home and starting to rent can be an option for some. It is a way to free up money from the sale of your home and spend it on travel and other enjoyable activities. Before exploring the options to rent, here are a few notes.
Be aware that renting from a private landlord is not without risk. In Alberta, the tenancy act states that a landlord can give a tenant notice if the landlord wants to sell the property, or if the landlord wants the property back for personal use. Therefore, one may lose the home and need to scramble for a new rental property.
Over the years, the real estate market in Calgary has shown many ups and downs. One day it is easy to find a rental, while the next day the market has shifted and left tenants scrambling. During the hype of the Covid market, many landlords decided to sell their rental properties. So while the vacancy rate was very low, many renters were out on the streets, with no place to go. In the meantime, rental prices skyrocketed because Alberta does not have a cap on maximum increases of rents.
Factor in additional costs when moving
When downsizing, or moving in general, it is important to get a good grip on the cost of selling and buying a property. Here are two overviews of cost when selling and cost when buying. In a nutshell, think of the following costs:
- Realtor fees when selling a home. (Although, in most cases buying fees are covered by the sellers’ brokerage.)
- Lawyer fees for two transactions, the sale and the purchase.
- Condo Documents. When buying a condo, it is strongly advised to ask for a condominium document review. In short, condo documents consist of 2 parts, the bylaws and the financials. Both are crucial components. The financials show crucial information on the financial health of the corporation. The bylaws show important rules and regulations, for example, regarding the allowance of pets.
- Real Property Report. When selling a single family home, an RPR, a real property report, is a crucial document that is requested by the buyer. If the RPR is lost, outdated or incomplete, a new RPR must be created by a survey company.
- Selling costs, in general. Sometimes, when selling, a home needs repairs or upgrades. Professionals such as an electrician, handyman, junk remover, cleaners, etc. may be required.
- Buying costs, in general. Although not mandatory, it is always a wise decision to hire a home inspector for a complete inspection of the property to buy. Also, other professionals may be required to repair or upgrade before moving in: painters, cleaners, those doing small or large renovations, etc.
- Every move costs money. If a professional moving company is required, the cost is obviously higher. Even the help of friends and/or family during the move usually requires renting a moving truck and some pizza.
For a more complete overview of buying and selling costs, visit closing costs for buying and for selling.
Fears and regrets about downsizing
Sometimes one fears making a wrong choice regarding downsizing. Over the years, though, we have rarely seen regrets.
Some people downsized too soon. They were still too active to move to an apartment, and a step in-between would have been a better choice. Moving from a large home with a garden to a condo may negatively affect people. They may feel closed in with little room to move around.
On the other hand, there are those downsizers who say they should have made the move much sooner. In hindsight, the stress of maintaining their big home took on a greater toll than expected. Once having de-cluttered and feeling a lighter weight, the mind freed up space, and the wallet freed up money.
Timing is everything, but one cannot necessarily determine the future. For example, the need for personal health care can progress much faster than expected. The effect is that one may have to move again, this time to a care facility.
Another regret is moving to a place too far from social circles. After all, social life is important to us humans. Therefore, always keep in mind that location may even get more important when one is aging.
The emotions that are impacted when downsizing are a valid point of consideration for many people. And stress often adds to the mix.
You’ll likely lose space as well as personal belongings. Therefore, it is usually suggested to start the downsizing process early, so one can take enough time to go carefully through it.
Important links to show potential options for downsizers
When downsizing, everyone’s needs and wants are personal. Here is a short overview with some links to popular requirements in a home for downsizers.
- Explore condo buildings that offer a tennis court and swimming pool. (coming soon)
- Pets are important in our lives! Discover condo buildings that allow pets.
- Calgary offers options for those 50+ and 55+ of age. These often offer social rooms, craft areas, and the likes. Look at what is for sale in this category.
- Villas are a great option when downsizing, as they lend themselves to independence. Find all villas currently for sale in Calgary.
- Just independent living or assisted living in Calgary? Find some information here.
- Need help decluttering? Here are a few options.
Kickstart the process of downsizing; talk to us
It is never too late to start thinking about the process of downsizing. Often, just this first conversation already gives you many needed answers to some difficult questions. So, any time, let us know if you are looking for help to move homes. We will sit down with you for a conversation about your wants, needs, the value of your home, the financial aspect of downsizing and most importantly, the options you have for moving.
We have a great deal of experience helping downsizers move homes. And above all, we understand that most people have a certain level of expectation. While, in our opinion, the City of Calgary never anticipated how many people needed to downsize in the near future, it is important to acknowledge how many options are available to downsizers!
We are Tanja van de Kamp and Ariette van Pelt, working as a team, both buying and selling homes in Calgary. Calgary has been our home since 2004, and real estate our full-time profession since 2009. Tanja was a lawyer in The Netherlands for 12 years, and learned how to negotiate strategically, and to work in the best interests of her clients. Thanks to our honest and transparent approach to real estate and towards our clients, we have built our business.
Over the years we have worked with many seniors looking to downsize homes. It is indeed a journey for most and we’d love to explore your options without any pressure or sales tactics.
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