The American Dream has been working on us from a young age.
Grow-up, go to college, get a career, and buy a house—the bigger, the better.
But with a larger house comes a larger payment plan, as well as more debts you just simply wouldn’t incur otherwise. Expenses like a lawnmower, new roof, renovations, and fences.
Pretty soon, it’s difficult to see if you started working a high paying job to enjoy the lifestyle or if you’re working that job to pay off that lifestyle directly. In fact, you may even still be paying off the college that brought you to that great job. At that point, you may have to take out a second mortgage, just to make the payments a bit easier to manage and still be able to afford that yearly vacation. Ouch.
If you’re shaking your head and saying “That’s not for me,” then welcome to the Housing Revolution. It’s time to analyze your house and decide if downsizing to an apartment is more of an upside for you.
Financial Benefits of Downsizing
The obvious benefit from downsizing is in the numbers. If you move from a spacious 2,000 sq ft home to a 1,200 sq ft apartment, you’re probably going to end up paying a lot less. Suddenly, you don’t have to pay for the yard care—or at least not all of it—and if something significant breaks, your wallet is pretty safe from those repairs.
Not only is your monthly housing payment lower, but the cost of heating and cooling the place just dropped as well. If you’ve timed the market correctly, you may even have a reserve of cash on hand from the money you made selling your house.
And since a smaller space equals less “stuff,” you’ll find yourself saving just because you don’t have room for very much. You won’t need half a dozen televisions or two sets of couches. Your closet may be full enough, and there really isn’t room for a new chair.
Due to the new restrictions on space, you may notice your bank account becoming more padded as those couple hundred dollars a month begin to add up and accumulate. Rather than slowly drowning in debt, you’ll be able to budget more substantial payments toward your schooling and other obligations. You may even be able to pay them off entirely from the money you’ll make selling your house!
The Lifestyle Benefits of Downsizing
As your dependency on your possessions begins to deteriorate out of necessity, and your bank account slowly climbs, you’ll discover a whole new benefit of downsizing: experiences.
The weight of having all of your possessions used to mean that when you traveled, you had to worry about it all. You probably paid for insurance or an added storage unit, and traveling itself may have been stressful because you were paying to both travel and have all of this stuff back at home waiting for you.
After downsizing, however, you know that what you have in your house is all the stuff you really care about. Beyond that, because it takes up less space to store all of that and because you have less, you can enjoy life more.
Now you can afford to take two, maybe even three backpacking trips every year, and enjoy riding bikes with your significant other. You can spend more time with your living companions talking and getting to know each other, rather than spend vast amounts of time in separate rooms.
You may be saying, “Ok, I’m on board, but where do I even begin?” That question is completely common, and we’ve compiled a few tips to get you started on your downsizing journey.
Set a Date
Decide on when you would like to have your house sold and be moved into your new place. If the housing market looks like it may be peaking, that time may be sooner rather than later. If you are having trouble deciding when would be the best time to sell, talk to a real estate agent.
Begin by sorting through your possessions. Start making several piles: one for throwing away, one for donating, and one for keeping. Decide to tackle a little each week, or, if you’re on a shorter timeline, a little each day.
Sorting the Piles
We all have possessions we’d instead not part with. It could be the rocking chair your grandfather made or the boxes of pictures that your mother left you with. Rather than getting rid of items that mean a lot, you could give them to family or friends who would cherish them. If giving away the pieces to a loved one just won’t work, and you can’t take it with you, taking a picture of the items will help keep the memories alive while taking up a smaller amount of space.
As for the boxes of pictures and home videos, the best spot for those might be in an external hard drive. This allows for easy sorting and access, while simultaneously freeing up space in your home.
The Upside to Downsizing
From finances to lifestyle changes, there are many benefits to downsizing to an apartment. The best thing, however, is probably the freedom that you’ll feel. With so many obligations in your life, it’s nice to come home to your apartment where you don’t have to worry about completing repairs and paying a massive mortgage. A few doors down from your friends, you can all gather together for a quick game night or easily take off on a spontaneous road trip. You’ll feel at peace knowing your home and the items you really care about are well taken care of and waiting for you when you get back.
Byline: Andrew Schmeerbauch is St. Louis native, real estate blogger, and Marketing Director at Clever Real Estate. A nationwide real estate startup that helps home buyers and sellers save thousands in real estate commissions.