A Meaningful Space welcomes back guest blogger Natalie Jones. Natalie and her husband, Jason, recently bought their first home. She hopes to make the process of buying a home less scary for first-timers by sharing what she and Jason have learned along the way. Natalie is originally from Denver, CO.
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What Not to Do When Downsizing
If you’re looking to decrease your number of household chores and upkeep responsibilities and increase your financial stability and freedom, downsizing can be a great way to accomplish this. However, if you don’t approach it the right way, it can end up being a stressful and costly experience. That’s why we’ve provided these common mistakes to avoid when downsizing:
Jumping the Gun
Are you certain that downsizing is the right move for you? Or are you just going on a whim? Downsizing is a serious commitment of time, energy, and money, and if you don’t take the time to plan it out, a lot of things can go wrong. Evaluate your financial standing, and research the housing market in your area to get an idea of what you can sell your house for. And if you’re moving to a different neighborhood or city, be sure to research the market there as well.
Also, you will want to look into your financing options to make sure you won’t have any problems getting the loan you need for your new home. There are several types of loans available to those who are downsizing. One of the most popular types is an FHA loan, which is a great option if you have a shorter credit history and/or don’t have a lot of money to put toward a down payment. Start your research with the PennyMac FHA loan, and go from there.
Settling on a Bad Offer
One of the most common mistakes made by people who are downsizing is accepting the first offer that comes to the table. Every now and then, the first offer will be great. But more times than not, it will take several offers and a lot of negotiating before an agreement is made that benefits both parties. Work with your real estate agent to determine a fair list price and navigate the negotiation process so that you can feel good about the sale when it happens.
Overlooking the Real Costs of Selling
While downsizing can put you in a better long-term financial situation, the process isn’t free. Along with the time and effort (and oftentimes stress), you have to consider the costs of prepping your current home to sell. Will you have to make major renovations and repairs or hire a home stager, photographer, cleaner, organizer, landscaper, and/or other professionals to make your home marketable? These are the kinds of questions to ask yourself when you’re planning out the costs of downsizing.
Refusing to Let Go
Oftentimes, one of the hardest parts of downsizing is paring down your belongings. However, for a downsize to be a true downsize, this step is necessary. Anything you can’t use or fit in your new home must be parted with. Take your time to reminisce over sentimental items as you pack them up to donate, sell, or give away. And if there are some items that you just can’t bear to part with, don’t force it. It may just require you to figure out how you can fit them into the new place.
Not Planning Out Your Furnishings in the New Place
Along with sentimental items, you will need to consider the size and layout of your new home when determining what furniture to bring along (or buy). If you are able to tour the home in person, take measurements so that you can reference them during the process. Otherwise, you risk having a large sofa or desk loaded into the home and nowhere to put it.
Financial stability and freedom can be yours from downsizing. But it’s not guaranteed. Be sure to consider all the mistakes listed here so that you will know what not to do as you prepare for and execute your downsize. Taking the right approach will save you a lot of stress and money along the way.