Downsizing from a home that has become too large for our needs can give us a new lease on life. Where a large property was once the ideal choice when our children were growing up, it’s now a burden on our everyday lifestyle and responsibilities.
Luckily, there are ways around dealing with an oversized, empty space you find you no longer need, and there are numerous benefits that come with it. For example, housing options like Lifestyle Communities offers affordable residences for those looking for a modern, fully-equipped home, without the sacrifice on location or amenities.
Downsizing doesn’t mean having to cut out all of your needs. Here’s what you can expect after you’ve made the big move…
Relieving the mortgage burden
Downsizing can remove the stress of having to keep up mortgage payments later in life. According to the Australian Centre for Social Innovation, while around 40 per cent of baby boomers own their own home, a third are still paying it off. Eventually, keeping up with these payments, as well as rising council rates, can eat into other spending options.
With a buoyant market for houses, selling the family home will most likely fetch a high price. For example, you’ll be able to afford a new, lower priced home in an environment like Lifestyle Communities, that you still own outright. Best of all, your money will not be eaten up paying council rates, and there are 13 locations to choose from in Victoria.
Freeing you up from around-the-home maintenance
Another benefit of buying a smaller home, is that there is no significant maintenance to undertake. Hanging on to a larger space comes with more responsibility to clean, cook and keep up with routine repairs.
If you are still working, as many baby boomers still are, the upkeep of the house can cut into time for your other pursuits. Choosing an apartment as your downsizing option will eliminate hefty duties. Alternatively, homes within Lifestyle Communities come with an onsite team that carries out any repair, gardening and security-related work.
The savings gap
As we reach the age of 65, another barrier to a comfortable future can loom in the form of a savings shortfall. We are the generation who came late to saving and to compulsory superannuation. Our equity is in our homes.
A survey by banking group HSBC found a quarter of all baby boomers have not started saving for retirement at all. And even for those who have saved for retirement, your savings may not cover your needs. Average life expectancy now stretches into the eighties. HSBC calculated that even for those with savings, their money would last just ten years.
So what happens then?
Getting equity back
Baby boomers have their equity tied up in the family home. Downsizing is a way of freeing up that money. It allows you to ensure you have enough to live on comfortably, giving you security for the years ahead.
According to BMT Quantity Surveying, baby boomers are rapidly choosing to downsize. And with the Federal Government keen to free up housing stock held by baby boomers, incentives will allow older generations to deposit $300,000 from the sale of a main residence into a superannuation fund. Not only will this relieve burdens for baby boomers, it will also allow for younger buyers a way into the market that’s recently been held up by a housing shortage.
A new lifestyle to look forward to
Downsizing can also be a step in the right direction for shifting your focus back to your own sense of self. It gives you the ability to figure out what you really want to do in the later years of your life.
Lifestyle Communities allows for independent living within a welcoming environment. While some residents are still within the workforce, some are semi-retired and others are permanently retired. But as your neighbours, you’ll be able to enjoy living in the vicinity of those from your own generation, within a protected and secure community.
To find out more about Lifestyle Communities and the options available, please contact our friendly team on 1300 505 560.