Some South Africans are choosing to downscale, for a number of reasons, and while many might still be sceptical of such a move, downscaling might have more benefits than they realise, says Mike Greeff, chief executive of Greeff Christie’s International Real Estate.
“Some of the benefits of choosing to downscale, he says, include:
* Living in a home more suited to your lifestyle
More often than not, people looking to downscale choose to do so in order to accommodate their living requirements and lifestyles. Your current living situation might exceed your needs and, as such, you could be spending a lot more money than you need to.
“One of the many life stages that often pre-empts people downscaling is your home recently being left empty with your children having moved out,” Greeff says.
* Cutting expenses
By downscaling, your maintenance costs will be significantly lowered and that is just the start. If you choose to move to a smaller property, your bond repayments will probably be lower.
Greeff adds that if it is within your means - due to you having sold your larger home - you could also choose to purchase a property for a lower value and not have any monthly repayments.
* Lower transport costs
The large family home might not be in close proximity to your place of work or close to family members you might want to see often.
By downscaling, you could choose to be closer to places of work and certain amenities that might have sprung up since you last purchased a property.
“This could certainly work in your favour and lower your travelling costs greatly as you would no longer need to spend in the same way as you did before you had downscaled.”
* A greater return on your investment
By having smaller, easily managed homes in your asset portfolio, Greeff says you are giving yourself a greater chance at a higher guaranteed return on investment over a reduced period of time.
“Your financial standing will also be immediately boosted by the liquid capital you have at your disposal.”
While the decision to downscale might seem daunting initially, Greeff emphasises there are immediate and long-term benefits linked to making the choice.
“Whether having more liquid capital available in the bank or taking the sadness away from being empty-nesters, downscaling could be the best decision you make.”