Why some baby boomers now regret downsizing

Years ago, Tracy Beckerman moved from New York to suburban New Jersey with her husband to raise her two children. But when the children grew up and left the nest, her husband urged her to return to town.

“He’s a musician and works in the city,” Beckerman says. “Over the years, we had dreamed of coming back, renting an apartment, and having the discretionary income to partake in all the great dining, music, and entertainment the city had to offer.”

So they sold their family home and downsized to a small apartment on the 43rd floor of a high-rise tower. At first, city life was all they hoped for. And then the pandemic hit and public health authorities advised people to avoid public spaces.

“I felt like a prisoner in the apartment,” Beckerman says. “We lived in a 57-story building and I felt freaked out when we took the elevator and not everyone was masked. After all the years of talking about how fun it would be, I hadn’t anticipated the inconveniences of living in a big city and certainly hadn’t planned to live there during a pandemic. If we had known what was going to happen, I would never have sold my house.

You might like: If you’re considering moving to the countryside, be aware of these hidden costs

Empty nests and downsizing

Many people buy a house when their children are small because they want more space and maybe a yard. So when those kids become adults and move out, it makes sense to downsize to a smaller home.

“Bigger, older homes can be difficult and expensive to maintain,” says Amanda Pendleton of Zillow Z,
Home trends. “Let’s say your retirement plans include a lot of travel. It’s harder to lock up and leave a larger, older home for months on end without worrying about potential problems like freezing pipes during the winter or overgrown landscaping.

Either way, the fewer people in your house, the smaller the house should be. “No matter the size of your home, seniors only use a small portion of their space, perhaps 500 square feet, per day,” says downsizing and cleaning expert and host Matt Paxton. from “Legacy List with Matt Paxton”.

Long-term homeowners may find that their home’s value has increased significantly, providing them with the opportunity to make a profit if they sell in today’s market. “They can use those capital gains and have a large nest egg for retirement, travel, or buying a smaller home that may have more desirable features or be in a more desirable location,” says Pendleton.

Also on MarketWatch: The Best and Most Affordable Places to Live in Florida

The COVID pandemic has muddled the equation

However, the COVID-19 pandemic, now in its third year, has caused many people 50 and older, like Beckerman, to re-evaluate their next chapter.

Common reasons for moving or downsizing once the kids are grown have become less compelling. For example:

Need less space. “Zillow to research found that nearly three million young adults returned home in the first months of the pandemic,” Pendleton said. “It probably delayed downsizing plans for some former empty nests, which suddenly found a full house.” Even though life is slowly returning to normal, many people are no longer sure they want to downsize given the uncertainty in life.

Easier movement. While Beckerman’s husband has continued to work in the city, many other people’s jobs have become remote and may remain so. This takes moves out of the equation of whether to hold or sell. “The ability to work remotely has allowed some older workers to move to a more affordable location or downsize,” says Pendleton. “These housing savings have helped them retire earlier than expected.”

Lifestyle changes. The pandemic has forced people to examine their lives, interests and redefine what is important to them. For example, if you’ve spent the past few years separated from your loved ones, you may realize it’s time to reconnect with friends and family. Or maybe you thought your next move would be to an apartment like the Beckermans, but now you wonder if a tall building will feel confined or if you’ll miss having your own backyard.

“Even before the pandemic, downsizing was down for empty nests,” says Jessica Lautz, vice president of demographics and behavioral insights for the National Association of Realtors. “Instead, a lot (of people) are looking to maintain square footage so they can still have room for their adult children to stay over the holidays. They trade for a comparable size in more affordable neighborhoods or small towns that are suitable for retirees. They also sell older homes in favor of new and turnkey properties.

Jody Halstead, 51, of Ankeny, Iowa, thought she would downsize but now plans to stay put to make room for her adult children.

“Looking at jobs and the cost of living, I wonder if my (current) teenagers will be able to afford to move,” she explains. “It might be smarter for us to keep our big house and convert the basement to an apartment when they can pay rent.”

Paxton’s stepmother, Cecelia, decided to sell her house and use the money to travel. But she wasn’t sure where she wanted to move, until Paxton offered to live with her blended family of six boys under 14 and a 16-year-old girl. He built a small apartment with an entrance at the back of his house.

“After the pandemic, she wanted to be closer to her grandchildren,” Paxton says of her mother-in-law. “This option gives her proximity to her family as well as her independence, and she can use the equity from the sale of her home to travel.”

As for Beckerman, she and her husband ended up moving out of town and buying a lakeside home in New Jersey. Instead of downsizing as an empty nest, they migrated to a larger home than the one in which they raised their children.

“I felt sad when we sold our family home; it was a final farewell to my time as a full-time mother,” says Beckerman, who writes humorous books about life in the suburbs. “I thought the city would be like living a fantasy, but ultimately it just wasn’t for us.

“Instead, we found this house that needs a lot of work (and) it turns out that restoring the house is just the lift I needed at this point in my life,” says -she. “A bigger house means we can entertain and house our adult children and their spouses; I look forward to hosting my daughter’s rehearsal dinner at home later this year.

More: ‘It’s not going away’: Long COVID destroys many Americans’ retirement hopes

Here’s how to prepare, even if you’re still not sure

If you think you might want to move in the next two to five years (even if you don’t know where you want to go), you can do the following to prepare:

Get your finances in order. Take steps to boost your credit score if necessary and understand how much home you can afford, says Pendleton. This is especially important if you plan to have a fixed income in retirement and will need a mortgage on your next home.

Clean a little at a time. Start small, one drawer at a time. “It took 50 years to accumulate all this stuff, so it will take more than a weekend to clean it all up,” advises Paxton. Also, don’t think of your home as a storage unit. “It’s time to tell your adult children to get their stuff and purge the old art projects and Legos you’ve held on to for 30 years,” he says.

Pay attention to the real estate market. “Keep an eye out for new listings in your neighborhood to see how much they’re selling for, especially homes that might be considered comparable to yours,” says Pendleton. Also research real estate in areas where you might consider buying a new home.

Consider the cost versus the value of the home improvement. Homes should be well maintained, but upgrades such as kitchen renovations may not be necessary. “Improvements like refinishing hardwood floors or painting are generally good value for money,” says Lautz. “But other projects like installing a swimming pool may bring you joy but not increase the value of your home when it comes time to sell.” Before making a major investment, consult a local real estate agent.

Think about your future needs. “Older Americans are healthier. They are living longer and want to enjoy their golden age,” says Pendleton. Consider factors such as climate, proximity to family, and accessibility (such as a first-floor master bedroom or minimal stairs) when moving into a new home.

Read next: How retirement coaches train people to make one of life’s trickiest transitions

Randi Mazzella is a freelance writer specializing in a wide range of topics from parenthood to pop culture to life after 50. She is a mother of three and lives in New Jersey with her husband and teenage son. Learn more about his work at randimazzella.com.

This article is reproduced with permission from NextAvenue.org© 2022 Twin Cities Public Television, Inc. All rights reserved.

More from Next Avenue:

Comments are closed.