Smart Steps to Downsizing

You may have spent years and a lot of money making your current house your “home" so thinking about downsizing can be emotional.

While leaving your home can be bittersweet, the anticipation of new beginnings and happy moments ahead brings comfort. Like any big life decision downsizing is going to take some research though.

Why do you want to downsize?

Understanding why you want to downsize is the first step. Knowing what you want to keep, what you’re willing to part ways with and things you want to change helps you understand the main reason for your decision.

You may want a different lifestyle, for example a sea change or tree change. Perhaps you may simply want a smaller, low maintenance home where you currently live. There can be financial motivations too; paying off debt, freeing up equity and reducing cost of living.

The combined outcome can mean more time and money to spend doing the things you love.

Affordability

Buying and selling property costs money, it’s not an easy swap. Some don’t realise the price they are selling their existing home for with the price of their new one, this is where you can get into financial trouble, because the cost of moving can realistically cost thousands of dollars.

Breaking it down into selling, moving, and buying costs, will help you work out how much will be available to spend or invest.

Location

Where you live shapes how you live—and changing it means moving again. So, think carefully about the people and places you want nearby (or further away). Whether it’s family, friends, the beach, or a favourite club, identifying these priorities will help focus your search.

Also consider the home itself: do you need a second bedroom for a snorer, space for visitors, or an outdoor area for morning coffee? Think about how you’ll live in the space day-to-day.

Even if you're in good health now, it’s smart to plan for the future—especially if you’re settling in long term. Ask yourself, “What if I need care later?” Many modern homes, including granny flats and retirement villages, are built with future care needs in mind, but still check for things like narrow hallways or tight bathrooms.

Lastly, consider how you’ll spend your time. Without a plan, the TV can quickly become your main activity. If you're looking at a retirement community, ask for an events calendar and highlight what interests you—it's a great way to ensure your lifestyle stays engaging.

Sign with confidence

No matter what type of property your new home is—whether it's a freehold, strata title, leasehold, licence, or a granny flat arrangement—you will need to sign a contract. This contract outlines your rights, responsibilities, and associated costs. It's essential that you fully understand these terms and ensure they are fairly balanced.

Among the various downsizing options, granny flat arrangements can be especially complex. These often involve family relationships, may not follow typical commercial terms, and if things go wrong, the consequences can impact the entire family.

Finally… the numbers

While the purchase price of your new home is often front of mind, there’s much more to consider.

If you're buying a freehold or strata property, you might also need to budget for stamp duty, strata or owners corporation fees, and the chance of special levies popping up. Even with a granny flat arrangement—often made with family—it doesn't always come free of cost.

In retirement communities, there’s usually a regular weekly or monthly fee to live there, and when it’s time to leave, there can be an exit fee. You might also share any gains or losses with the village operator, and cover things like renovation, marketing, and selling costs.

A good way to make sense of it all is to break the costs down into three parts: what you pay to move in (ingoing), while you're living there (ongoing), and when you leave (outgoing). This can make it easier to compare different options and understand what you're really signing up for.

Once you know the full cost of your next home, you'll get a clearer picture of your overall financial situation—how much money you’ll have to work with, what government support you might be eligible for, what your cash flow will look like, and how you’ll manage things if aged care is needed down the track.

At the end of the day, the “where” and “why” of your downsizing move matter just as much as the dollars and details. Getting real value often comes down to how you spend your time—and who you spend it with.

If you’re thinking about moving from the family home into a retirement village, you can find out more about the two retirement villages that we manage here.