So, you have sold or disposed of your home for many years and are now ready to move out. The questions are where, when and how. You have taken the decision to downsize, and taken the first steps. One solution is to buy another home straight away, but there are other options.
The rental downsizing option
In a recent survey, 39% of respondents stated that they intended to move into rented accommodation after selling their home. There are many benefits in doing so:
- Renting provides you with the breathing space to think long and hard about where and how you want to spend the next part of your life. You then have the flexibility to consider all your options before taking the plunge.
- If you are moving to a new area, renting makes a lot of sense. By being on the spot you are in an ideal position to understand the local market, check out all the options and look out for the sort of home you might most want to live in next. You are not under any time pressure, and, of course, if you have sufficient equity in the home you have just sold to buy another home, you are the “ideal purchaser”. No chain and finance in the bank – the estate agent’s dream client, and that’s worth a price discount in itself.
- You may be of a certain age and for the next few years want to live in a home with a garden or more space than you really need, and maybe move into a smaller place after that. Renting will save you the cost of buying and selling another home.
- Renting frees you up from many of the problems of home maintenance. As a tenant you have the responsibility to keep the home in reasonable condition, subject to “normal wear and tear”, but any breakdowns or upgrades are the responsibility of the landlord.
- You may want to use the equity in the property you have sold for other purposes – to augment your pension, help the next generation buy their own homes or whatever.
- And finally, if and when you decide to move on, all you have to do is give notice to the landlord.
As a retired and solvent person, you are the ideal tenant, and any landlords would do their outmost to make sure you are happy in their house and will stay as long as possible.
Retirement developments for downsizing buyers
When and if you decide to buy a home for your next move, there is no shortage of options. If you have rented in the meantime you will have had plenty of opportunity to explore the area and decide exactly where you would like to live.
Many people have considered buying an apartment or smaller house on one of the developments created specifically for retired people.
These come in many shapes and sizes. Some offer a full time warden and emergency call support. Others simply provide maintenance of areas used by all residents such as shared gardens and landscaping and access driveways.
It is important to understand the fine detail of retirement development contracts. How much is the annual management charge, and how is it calculated? Is the management charge fixed, or is it subject to increases with inflation? Also who provides the support services, and how are these guaranteed?
You might also want to consider the likely age profile of your new neighbours. If the development has been promoted specifically for people of a certain age woud you prefer to live in development that is also trying to attract younger people or families?
Finally, how easy is it going to be to build up an active social network if your home is isolated from the rest of the wider community?
All these are important considerations before moving into a retirement development or community.
For further information about downsizing we provide advice about getting started.
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