National Conveyancing Week: How to Downsize
In celebration of National Conveyancing Week, Irwin Mitchell have written a series of articles aimed at supporting residential property buyers and sellers to understand some of the complexities of specific transactions.
It is never an easy decision to consider moving from your home where you have raised your family for many years to a smaller property and this can leave you feeling anxious and having many questions. However, there are many benefits of downsizing, and it may just be the best thing you do for your future.
If you are thinking of downsizing, there are numerous factors to consider, and this short guide will give you a good place to start.
Is it the right time to downsize?
There are many reasons why you might be considering downsizing; your children may have grown up and moved away, you may want to retire and release equity to facilitate your retirement, you might want to reduce your outgoings or want to be closer to family members.
Whatever the reason, it is a difficult decision, and you should ensure you have time to carefully think everything through, discuss it with others and not be pressured into making any choices which you are not comfortable with.
What to consider when putting your property on the market
If you haven’t sold a property for some time, it might be a daunting prospect. To put yourself in the best position, you should ensure the property is fully prepared for market. You may need to complete any unfinished work and consider the furniture in your home. You may need to sell or donate a large amount of your furniture if it is not going to fit in your new home.
You should take some time to research the current market and how long properties are remaining for sale. It might take some time to find a buyer or, if the market is strong, you might want to hold back from marketing your property until you have had a chance to look at some properties to purchase.
It might have been some time since you looked at documents relating to your property. You will need to collate documents such as gas safety certificates or information about alterations you made to the property. However, having this ready before marketing will increase your chances of a smoother transaction and clear up any initial questions your buyer may have about the property. If your property is not registered at the Land Registry, you should discuss this with your conveyancer, as they may advise it is best to get the property registered before marketing.
Finding and viewing a property
When looking at properties to purchase, there are various factors to consider.
Location is always important, and you will need to consider carefully what you want for the property and your future. You should consider local amenities, but also consider what changes are happening in the area and how this may affect your enjoyment of the property in the future. If you do not drive or looking to drive less, you should consider public transport links. If you are moving to a new area, it is important to take the time to familiarise yourself and visit the area at different times of day to ensure you will be comfortable.
It is important to understand your financial position. Not simply the prices of the properties you are selling and buying, but also moving costs, such as removals, legal fees and stamp duty.
You may need to decorate or make alterations to the property and purchase new furniture. You should ensure these are included in your moving budget. You should also take the time to understand future outgoings and where costs, such as council tax or service charge in leasehold properties, may increase or may vary from year to year. You might wish to consider purchasing a new-built property, which generally has lower maintenance costs and be more energy efficient. However, you should check the Energy Performance Certificate (EPC) on any property to assess any improvements you might want to make to reduce your outgoings.
Downsizing to a Flat
There are some advantages to downsizing to a leasehold property. You will not need to undertake maintenance to the exterior of the property, and, in retirement properties, there is often community facilities available and sometimes the security of warden control. However, you may be restricted in making internal alteration and there may be a higher level of service charge or extra ‘entry’ contributions towards a reserve fund.
The Benefits of downsizing
Although moving may seem like a big upheaval, there are many benefits to taking the step. It may enable you to be mortgage free, to retire early, to set up for the next stage of your life, reduce the time you spend cleaning and maintaining your property and reduce your outgoings.
Whatever your reason for downsizing, you should ensure you are well advised by your estate agent, conveyancers, surveyor and financial advisor. You should be comfortable asking any questions about your property and the process. Downsizing can be as exciting as purchasing your first home, but you must take your time to ensure you are making the best choices.
