Downsizing the Home

[chinaco]

When I FIRE... the first order of business, besides a little traveling, is to get the house ready to sell.


We intend to downsize and simplify.


We know what kind of home we want to buy.

But since DW and I intend to do some extended traveling, I am wondering if we should just sell our home and rent a condo for a couple of years while we do some extended traveling.

This might accomplish two goals:

1. Break apart the stress of sell/buy alignment
2. Reduce the risk of leaving an empty unattended stand alone house for months at a time.

Anyone ever rent for a few years after they downsized? What are the pros and cons of this approach?

[Corporate ORphan]

We are in the boat though we don't know where we want to relocate.

One other of our concerns is if inflation comes back (our first home loan was at 18%!) If we sell our house now, will the houses go up so that we can't afford another nice one when we are ready to buy

[chinaco]

Quote:

Originally Posted by Corporate ORphan We are in the boat though we don't know where we want to relocate. One other of our concerns is if inflation comes back (our first home loan was at 18%!) If we sell our house now, will the houses go up so that we can't afford another nice one when we are ready to buy

Yes.

But, we would pay cash for the purchase of the new home, so a loan would not be the risk. But the cost of a House could increase more than expected due to inflation in home cost or construction.

Still, I anticipate the impact to be minimal for the time period (few years at most). Where we live, the cost of a home did not go up a huge amount during the bubble. The IRR on our home was fairly low given the valuation change even at the peak.

[rescueme]

Quote:

Originally Posted by chinaco When I FIRE... the first order of business, besides a little traveling, is to get the house ready to sell. We intend to downsize and simplify.

Why?

[Midpack]

I'm with you chinaco. We will downsize too, from about 2,300 to 1,300-1,500 sqft (more than enough). Why pay property taxes, utilities and higher general home expenses for space we don't want? We'd rather have a high quality small home than the opposite (Not So Big House, Ross Chapin, etc.).

Our strategy in retirement spending is to get fixed expenses as low as we're comfortable with, that has to start with home, cars & food IMO.

We've begun selling off furniture already. Our new house will not have a living room or a dining room, we've never used either in over 30 years, though we bought furniture for both like all good Americans were expected to!

Still deciding where, Raleigh-Durham is at the top of our list now but still evolving to be sure...

[Orchidflower]

I was pretty much in the same boat at the OP, but decided that buying now was smarter than waiting due to the low cost of housing. No idea what it would be in 3+ years, so moved to an area with low property tax which settled the issue.

Maybe some of us just feel more comfortable knowing we have something that's ours waiting for us when we come back to it. I know I do.

[Moemg]

We are also planning on downsizing not sure when but we are slowly working toward that goal . Right now Florida is still in a housing slump and I have no interest in giving away my house but hopefully as soon as some of these foreclosures are sold things will improve . I think about 2100 square feet would be ideal .

[W2R]

Quote:

Originally Posted by chinaco When I FIRE... the first order of business, besides a little traveling, is to get the house ready to sell. We intend to downsize and simplify. We know what kind of home we want to buy. But since DW and I intend to do some extended traveling, I am wondering if we should just sell our home and rent a condo for a couple of years while we do some extended traveling. This might accomplish two goals: Break apart the stress of sell/buy alignment Reduce the risk of leaving an empty unattended stand alone house for months at a time. Anyone ever rent for a few years after they downsized? What are the pros and cons of this approach?

Depending on the condition of your local housing market, it may take considerably longer to sell than you expect.

Why not put the house on the market and begin your extended traveling while it sells? You could put your stuff in storage, if you are concerned that it might be stolen. That would be less expensive than a condo. Your realtor can help you arrange someone to check on your home now and then. When you get home, hopefully your house will be sold. At that point, you could rent a corporate apartment (furnished, month-by-month) until you can find and buy your new home. I would expect that this won't take more than a couple of months or so, with the great selection of homes available.

This way you might not need to rent a condo for the whole time.

[hankster]

Quote:

Originally Posted by chinaco When I FIRE... the first order of business, besides a little traveling, is to get the house ready to sell. We intend to downsize and simplify. We know what kind of home we want to buy. But since DW and I intend to do some extended traveling, I am wondering if we should just sell our home and rent a condo for a couple of years while we do some extended traveling. This might accomplish two goals: Break apart the stress of sell/buy alignment Reduce the risk of leaving an empty unattended stand alone house for months at a time. Anyone ever rent for a few years after they downsized? What are the pros and cons of this approach?

We downsized 2 years ago in preparation for retirement. We got a sweet deal with dirt cheap rent in a company owned house near my workplace. Got rid of the 10 acres with house, shop, barn. High maintenance.

Like you, we are travelers. We've been traveling a lot since the house sold and plan to be on the road about 6 months/year after FIRE. We think a condo rental is our best option for the early years of retirement. We would be unlikely to buy a condo. We'd prefer to have a small house when we do finally stop being road warriors

[Orchidflower]

Quote:

Originally Posted by Midpack We've begun selling off furniture already. Our new house will not have a living room or a dining room, .

Out of curiosity, will you be using a table and chairs to eat on in your great room? What do people do when they have guests over to eat in a great room or don't they do that? I always wondered about that aspect of the great room idea that's in vogue...altho I do love the look, also.

[REWahoo]

Quote:

Originally Posted by Orchidflower What do people do when they have guests over to eat in a great room ...

If they are like us, they go out to eat. I think that's how the room got its name...

Me: "James and Judy are coming over. Let's go out to eat."
DW: "Great!"

[W2R]

Quote:

Originally Posted by Orchidflower Out of curiosity, will you be using a table and chairs to eat on in your great room? What do people do when they have guests over to eat in a great room or don't they do that? I always wondered about that aspect of the great room idea that's in vogue...altho I do love the look, also.

I have plans to turn my (completely unused) dining room into a home gym. Can't wait! I have laid it out on graph paper, which gives me an idea of how much equipment I can fit in there and how I could arrange it. When we get together with friends or relatives to eat, generally that happens at a restaurant instead of at someone's house.

Quote:

Originally Posted by REWahoo If they are like us, they go out to eat. I think that's how the room got its name... Me: "James and Judy are coming over. Let's go out to eat." DW: "Great!"

Yeah, like he said. I posted before seeing his post.

[REWahoo]

Quote:

Originally Posted by W2R I have plans to turn my (completely unused) dining room into a home gym. ..... When we get together with friends or relatives to eat, generally that happens at a restaurant instead of at someone's house.

Sounds like a great room!

[W2R]

Quote:

Originally Posted by REWahoo Sounds like a great room!

It's gonna be fabulous! I already put my old 19" TV in there, and I have picked out the exercycle that I want. There will be room for a treadmill and a home gym in there too, when I get around to thinking about them, and plenty of room for Wii Fit. I'll put mirrors and a white board on the walls, and it already has a high ceiling fan to keep me cool. There is room for F.'s free weights, and he can work out there too if he wants to.

My den is where I LIVE -- guess that could be called my great room, but I call it the den.

[Moemg]

Quote:

Originally Posted by Orchidflower Out of curiosity, will you be using a table and chairs to eat on in your great room? What do people do when they have guests over to eat in a great room or don't they do that? I always wondered about that aspect of the great room idea that's in vogue...altho I do love the look, also.

Most newer Florida homes are the great room plan but they still have a dining area . The thing that is good about that is when you have big celebrations such as Christmas or Thanksgiving you can just extend the table into the living area .

[Bestwifeever]

Quote:

Originally Posted by chinaco Anyone ever rent for a few years after they downsized? What are the pros and cons of this approach?

I have family who did just this. They lived in an apartment for about five years after retiring and selling their house and recently bought a new townhouse.

The cons for the apartment were a few rowdy neighbors (and moving twice as a solution). They also had to get used to unassigned parking places where they rented (Both educational--the townhouse they bought is so well built you wouldn't hear a bomb go off in the unit next to them and it has two assigned spots for them). Another pro for the rental was that the proceeds from the sale of the house generated enough income to pay most of their rent.

I don't think they felt their apartments were as secure as the townhouse turned out to be in terms of lock and leave for travel but family kept an eye on the apartments for them.

[Midpack]

Quote:

Originally Posted by Orchidflower Out of curiosity, will you be using a table and chairs to eat on in your great room? What do people do when they have guests over to eat in a great room or don't they do that? I always wondered about that aspect of the great room idea that's in vogue...altho I do love the look, also.

We much prefer the great room concept, we wouldn't consider a home with a formal dining or living room ever again. We'll have a dining area adjoining the kitchen. Right now we have that and a formal dining room, that's what I'm talking about doing without (we used the formal dining room less than once/year for the past 25+ years). And we kinda like to meet friends for dinner at restaurants a lot of the time too.

[flyfishnevada]

How about renting your house while you figure out what to do. You probably won't make much, if any, income, but someone else with be paying your mortgage. if it's paid off, you can use the rent they pay your to rent your own smaller place. In this market, lot's of people looking to rent, not as many looking to buy.

[Katsmeow]

Chinaco

I love W2R's idea of traveling while your house is on the market. We put our house on the market last April with the thought that it would sell by the fall. After Thanksgiving we took it off the market for the holidays and it is going back on the market in the next week or so.... Point being that it can take longer to sell than expected.

We did consider renting for a few years since we still have 2 teenagers at home but we have pets that making renting impractical. If it wasn't for that I think it is a good option.

Quote:

Originally Posted by Orchidflower Out of curiosity, will you be using a table and chairs to eat on in your great room? What do people do when they have guests over to eat in a great room or don't they do that? I always wondered about that aspect of the great room idea that's in vogue...altho I do love the look, also.

Here are a couple of pictures:

Tilson Homes-Plan Details

This is the plan of the house we are likely building. Scroll down on the left to view the kitchen picture and then the family room picture. However, we plan to make the kitchen slightly larger and put in the large curved bar in the link below. (The house in the below link is way too large but I do like the island/bar).

Tilson Homes-Plan Details

That large curved bar will easily seat 8 people, plus there is a breakfast table that will sit 6. We don't usually have more than 14 people over to eat.

[Khan]

I am looking to move to a 1 BR Apt after the cat dies.