Complete Downsizing Guide for 65+ Homeowners

Why Downsize

The decision to downsize is deeply personal, but there are several common reasons why homeowners over 65 consider this step:

1. Maintenance Challenges: As we age, the upkeep of a larger home can become physically demanding and time-consuming.
2. Financial Considerations: Downsizing can free up equity, potentially reducing expenses and providing funds for retirement or other pursuits.
3. Changing Needs: With children grown and out of the house, you may find yourself with more space than necessary.
4. Health and Mobility: A multi-story home may present challenges as mobility issues arise.
5. Lifestyle Changes: You might desire a living situation that offers more social opportunities or requires less responsibility.
6. Proximity to Services: Moving to a more central location can provide better access to healthcare, shopping, and cultural amenities.

Potential benefits of downsizing include reduced stress from home maintenance, lower utility costs and municipal taxes, and the opportunity to declutter and simplify your life. It can also provide the chance to move closer to family or to a community that better suits your current lifestyle.

Signs it might be time to consider downsizing:

• Feeling overwhelmed by home maintenance
• Noticing unused rooms in your house
• Struggling with stairs or other aspects of your home’s layout
• Wanting to free up equity for travel, hobbies, or financial security
• Desiring a change in lifestyle or location

Remember, contemplating downsizing doesn’t mean you have to make an immediate decision. It’s about exploring your options and determining what’s best for you.

The Emotional Journey

Downsizing is more than a logistical process – it’s an emotional journey. Your home holds memories, represents years of your life, and is likely your most significant financial asset. It’s natural and valid to experience a range of emotions when considering this transition.

Many people report feeling:

• Nostalgia for the life lived in their current home
• Anxiety about the unknown
• Relief at the prospect of reduced responsibilities
• Excitement about a new chapter in life
• Sadness about leaving familiar surroundings

These feelings are all normal parts of the downsizing process. Here are some strategies to help navigate the emotional aspects:

1. Acknowledge Your Feelings: Give yourself permission to feel whatever emotions arise. There’s no “right” way to feel about this transition.
2. Focus on the Positive: While it’s important to honor your attachment to your current home, try to envision the positive aspects of your future living situation.
3. Take It Slow: Downsizing doesn’t have to happen overnight. Give yourself time to adjust to the idea and process your emotions.
4. Involve Loved Ones: Share your thoughts and feelings with family and friends. They can provide emotional support and practical help.
5. Preserve Memories: Consider ways to keep the memories of your home with you by creating photo albums or selecting meaningful items to bring to your new space.
6. Seek Support: If you’re struggling with the emotional aspects of downsizing, consider talking to a counsellor or joining a support group for seniors in transition.

Remember, it’s possible to honor your past while embracing your future. The key is to approach the process with patience, self-compassion, and an open mind.

Financial Implications of Downsizing

Understanding the financial implications of downsizing is crucial for making an informed decision. Let’s explore the potential costs and benefits associated with different housing options:

Comparing Costs

Condos:

• Purchase price: Generally lower than detached homes
• Property taxes: Often lower due to smaller space
• Maintenance fees: Can range from $0.60 to $1.00+ per square foot monthly
• Utilities: Usually lower due to smaller space

Smaller Houses:

• Purchase price: Varies widely depending on location and condition
• Property taxes: Likely to be lower than your current home
• Maintenance costs: Lower than a larger home, but still your responsibility
• Utilities: Reduced compared to a larger home

Senior Communities:

• Purchase price or rent: Varies widely
• Monthly fees: Often include some utilities and amenities
• Additional costs: May include meal plans or other services

Senior Residences:

• Monthly fees: Can range from $3,000 to $7,000+ depending on level of care and amenities
• Often all-inclusive, covering accommodation, meals, and some level of care

Hidden Costs to Consider

• Real estate commission and legal fees when selling your current home 
• Land transfer tax and legal fees if you’re purchasing vs renting 
• Moving expenses
• New furniture or renovations for your new space
• Potential increases in condo fees or residence costs over time

Freeing Up Equity

Downsizing often releases equity from your current home. This can provide funds for:

• Travel and leisure activities
• Creating an emergency fund
• Supplementing retirement income
• Gifting to family members
• Investing for future needs

Tax Implications

In Canada, the sale of your principal residence is exempt from capital gains tax. Consult a tax professional if you’ve rented out part of your home or used part of it for business purposes.

Financing Options for Seniors

If you need financing for your new home, several options are available:

1. Conventional Mortgages: Yes, you can get a mortgage if you’re retired. You’ll still need a downpayment and will have to demontrate to the lender that you have ongoing income (eg. retirement pension or investment income). 
2. Home Equity Line of Credit (HELOC): This can be used to bridge financing if you need to purchase before selling.

Always consult with a financial advisor to understand which option best suits your situation.

Remember, while downsizing often leads to reduced housing costs, this isn’t always the case. Carefully consider all expenses associated with each option to ensure it aligns with your financial goals.

Related: How Much Does it Cost to Sell?

Related: How Much Does it Cost to Buy? 

Exploring Your Downsizing Options

When it comes to downsizing, one size doesn’t fit all. In this section of our guide, we’ll look at: 

• Various housing styles: condos, smaller houses, retirement communities, senior residences
• Renting vs. buying
• Making the right choice

Housing Style Options

Condos

Condominiums are a popular choice for downsizers, offering a blend of ownership and convenience. There are high-rise condominiums with views and amenities, low-rise condominiums that promote a sense of community and townhouses that provide a house-like feel with condo amenities. 

Pros:

• Lower maintenance responsibilities
• Often located in desirable urban areas
• Access to amenities like fitness centers or pools
• Potential for a more social environment

Cons:

• Less privacy than a detached home
• Monthly condo fees
• Need to adhere to condo board rules
• Potential for special assessments for major repairs

When considering a condo, pay close attention to the condo corporation’s financial health and the building’s maintenance record.

Related: The No Nonsense Guide to Downsizing to a Condo

Related: How to Buy a Condo

Smaller Houses

For those who want to downsize but still live in a house, downsizing to a smaller house can be a great option. Choose from bungalows for single-story living, semi-detached or attached houses that offer greater affordability or townhouses that balance space and manageability.

Pros:

• Maintain the privacy of a house
• Often come with a small yard or garden
• More control over your living space
• No condo fees

Cons:

• Still responsible for all maintenance and repairs
• May be located in less central areas
• Fewer built-in social opportunities

When looking at smaller houses, consider future accessibility needs and the long-term manageability of the property.

Senior Communities

Age-restricted communities offer a lifestyle tailored to active seniors.

Pros:

• Designed with seniors in mind
• Rich in amenities and social activities
• Often offer a range of housing types within the community
• May provide options for additional care as needs change

Cons:

• Can be expensive
• May feel age-segregated
• Rules and restrictions on visitors or activities

These communities can be an excellent option for those seeking an active, social environment with peers.

Senior Residences

For those requiring more support, senior residences offer a range of care options, from independent living (for active seniors needing minimal assistance), assisted living (providing residents with help with daily activities) and long-term care (for seniors who need 24/7 care). 

Pros:

• Tailored care and support available
• Meals and housekeeping often included
• Social activities and outings organized
• Medical staff often on-site

Cons:

• Less independence
• Can be costly
• May require adjusting to a new routine and environment

When considering a senior residence, assess the level of care provided, the quality of staff, and the overall atmosphere of the facility.

Each of these options offers a unique living experience. The best choice depends on your individual needs, preferences, and circumstances. 

Related: Tips for Choosing the Right Retirement Community 

Renting vs. Buying

As a current homeowner, one of the biggest decisions you’ll have to make is whether to buy or rent your next home. Let’s explore the advantages and considerations of each option to help you make an informed decision.

The Case for Owning

Control Over Your Environment

When you own your home, you maintain control over key decisions that affect your daily life. This includes:

• Renovation timing and choices
• Decor and modifications for aging in place
• Property improvements and updates
• Pet policies and restrictions
• Long-term stability planning

Financial Benefits

Ownership can offer several financial advantages:

Building Equity

• Continue growing your asset base
• Potential for property value appreciation
• Option to leverage equity for future needs
• Tax advantages of property ownership

Predictable Costs

• Fixed mortgage payments (if applicable)
• Protection from rental market fluctuations
• Long-term cost stability after mortgage is paid
• Potential for rental income from basement or spare rooms

Investment Strategy

• Opportunity to maintain a mortgage while investing other assets at higher returns
• Property as part of your estate planning
• Tax-efficient wealth transfer to next generation

Security and Stability

Ownership provides protection from:

• Landlord-initiated moves
• Unexpected renovation disruptions
• Market-driven rent increases
• Changes in rental market conditions

The Case for Renting

Renting offers significant lifestyle and financial advantages:

Location Flexibility

• Ability to try different neighborhoods
• Easy relocation to be closer to family
• Option to downsize gradually
• Seasonal location changes without property commitment

Lifestyle Benefits

• Lock-and-leave convenience
• Simplified financial planning
• Reduced responsibilities
• Easier transition to assisted living if needed

Financial Benefits

• No property maintenance expenses
• Lower insurance costs
• No property tax obligations
• Predictable monthly expenses
• Access to home equity for other purposes
• Investment diversification opportunities
• Reduced exposure to real estate market fluctuations
• No large capital commitment

Maintenance-Free Living

Renting eliminates the burden of:

• Property maintenance and repairs
• Emergency replacement costs
• Seasonal maintenance tasks
• Building system updates

Related: Rent vs. Buy for Seniors

Related: From Homeowner to Tenant: Making a Smooth Transition

Making the Right Choice

Here are key points to keep in mind as you evaluate your downsizing options:

Location

• Proximity to family and friends
• Access to healthcare facilities
• Availability of public transportation
• Nearby amenities (shopping, restaurants, parks, cultural venues)
• Familiarity with the area

Accessibility Features

• Single-level living or elevator access
• Wide doorways and hallways
• Walk-in showers with grab bars
• Good lighting
• Easy-to-use handles and switches

Amenities and Services

• Fitness centers or exercise classes
• Social and recreational activities
• Housekeeping services
• Meal options
• Transportation services

Social Environment

• Opportunities for social interaction
• Community events and activities
• Compatibility with neighbors or fellow residents
• Policies on visitors and overnight guests

Health and Wellness Support

• Proximity to medical care and pharmacies 
• Availability of emergency services 
• Transportation options for medical appointments
• Wellness programs
• Ability to age in place with increasing care needs

Future Care Needs

• Options for additional support if needed
• Proximity to hospitals and specialists
• Availability of in-home care services
• Transition options within a community or residence

Financial Considerations

• Initial costs (purchase price or fees)
• Ongoing expenses (mortgage, rent, or monthly fees)
• Potential for home value appreciation
• Tax implications
• Insurance costs

Climate and Weather

• Suitability of local climate for your health and preferences
• Availability of indoor spaces for year-round activities

Personal Preferences

• Size and layout of living space
• Storage options
• Outdoor space or gardening opportunities
• Pet policies
• Parking availability

Management and Governance

For condos and communities:

• Quality of management
• Financial health
• Resident satisfaction

For senior residences:

• Staff turnover
• Resident-to-staff ratio
• Resident satisfaction
• Care philosophies

When evaluating these factors, consider both your current needs and how they might change in the future. It can be helpful to create a checklist of your must-haves and nice-to-haves to guide your decision-making process.

Remember, there’s no perfect choice – each option will have its pros and cons. The goal is to find the best fit for your unique circumstances and preferences. Don’t hesitate to ask questions, request multiple visits, or even arrange a short-term stay if possible when considering senior communities or residences.

Ultimately, the right choice is one that provides you with a safe, comfortable, and enjoyable living environment that supports your desired lifestyle and future needs.

The Downsizing Process: Step-by-Step

Downsizing can seem overwhelming, but breaking it down into manageable steps can make the process smoother. Here’s a guide to help you navigate the journey:

1. Assess Your Current Situation and Future Needs
   • Evaluate your current home’s suitability
   • Consider your health, mobility, and care needs
   • Think about your desired lifestyle and location
2. Set Goals for Your New Lifestyle
   • Define what’s important to you in your next home
   • Consider factors like proximity to family, healthcare, and amenities
   • Determine your budget and financial goals
3. Research Options in Your Desired Area
   • Explore different housing types and neighborhoods
   • Visit potential communities or residences
   • Speak with residents or attend community events if possible
4. Create a Downsizing Timeline
   • Set a target date for your move
   • Work backwards to create milestones for decluttering, selling, and moving
5. Sort and Declutter
   • Go through your belongings room by room
   • Categorize items into keep, sell, donate, and discard
   • Consider enlisting family members or a professional organizer for help
6. Sell, Donate, or Dispose of Items
   • Host a garage sale or sell items online
   • Donate usable items to charity
   • Properly dispose of items that can’t be sold or donated
7. Prepare Your House for Sale
   • Make necessary repairs and improvements
   • Consider professional staging to showcase your home’s potential
   • Discuss pricing strategy with a real estate agent
8. Navigate the Real Estate Market
   • Choose a realtor experienced in working with senior sellers
   • Understand the current market conditions
   • Be prepared for the emotional aspect of showing and selling your home
9. Plan and Execute the Move
10. • Hire a reputable moving company
    • Pack strategically, labeling boxes clearly
    • Arrange for help on moving day if needed

Remember, this process takes time. Be patient with yourself and don’t hesitate to ask for help when needed. Many seniors find that once they’ve completed the downsizing process, they feel a sense of relief and excitement about their new chapter.

Related: Downsizing Your Belongings: Making Tough Choices

Related: 40 Things to Help Seniors Age-in-Place 

Related: 9 Downsizer Mistakes

Making the Transition

Below, we’ve compiled our best advice to helping you make a successful downsizing transition. We cover:

• Designing Your New Space
• Staying Connected
• Moving

Designing Your New Space

Moving to a smaller space doesn’t mean sacrificing comfort or style. With thoughtful planning and creative solutions, you can create a home that’s both functional and inviting. Here are some tips for designing your new downsized space:

Multi-functional Furniture

• Opt for pieces that serve multiple purposes, such as a coffee table with storage or a Murphy bed for guests
• Consider expandable dining tables for flexibility in entertaining

Efficient Storage Solutions

• Utilize vertical space with tall bookcases or wall-mounted shelves
• Invest in under-bed storage containers
• Use drawer organizers and closet systems to maximize space

Scale Your Furniture

• Choose smaller-scale furniture that fits your new space
• Avoid overcrowding rooms with too many pieces

Create Defined Areas

• Use area rugs or furniture placement to create distinct “zones” in open-plan spaces
• Consider a room divider for flexibility in studio apartments

Maximize Natural Light

• Use light, airy window treatments to let in natural light
• Place mirrors strategically to reflect light and create the illusion of more space

Color and Decor

• Use a cohesive color scheme throughout to create flow
• Consider lighter colors to make spaces feel larger
• Display cherished items as decor to personalize your space

Smart Technology

• Consider voice-activated lighting and thermostats
• Install security systems with mobile monitoring
• Add motion-sensor lighting in bathrooms and hallways
• Explore automated medication reminders
• Set up video doorbells for enhanced security

Future-Proofing Your Space

• Install grab bars that double as towel racks
• Choose lever handles instead of doorknobs
• Ensure adequate lighting in all areas
• Consider pull-out shelving in lower cabinets
• Plan for potential mobility changes

Staying Connected: Social Aspects of Downsizing

Maintaining and building social connections is crucial during and after downsizing.

Building New Connections

• Participate in community activities and events
• Join resident committees or social groups
• Attend building or neighborhood gatherings
• Consider volunteer opportunities nearby
• Explore local senior centers and programs

Maintaining Existing Relationships

• Host small gatherings in your new space
• Use technology to stay connected with family
• Plan regular outings with friends
• Create new traditions in your new home
• Schedule regular video calls with distant family

Moving

If you haven’t moved in a while, here’s a quick list of to-do’s:

• Notify important contacts of your new address
• Update your driver’s license and health card
• Transfer or set up new utilities
• Register to vote at your new address
• Update insurance policies

Downsizing with BREL

The BREL team has been helping seniors downsize in the Greater Toronto Area for more than 15 years. We’ve:

• Sold over $1 billion in real estate
• Helped more than 2,000 clients
• Have 750+ 5-star reviews ⭐️⭐️⭐️⭐️⭐️  (you can read them here)

Here are some of the reasons to consider hiring the BREL team to help you downsize:

• Experience Working with Seniors and Downsizers – We understand the emotional and logistical challenges of downsizing and have developed partnerships, tools and systems to cater to the unique needs of downsizers.
• Specialized Skills and Training: Every BREL agent is a Certified Negotiation Expert. Some of our agents have also achieved the Seniors Real Estate Specialist designation (SRES).
• Listing Services:
  • Home Preparation: We’ve partnered with trusted home service professionals focused on helping seniors and downsizers.
  • Staging: Our in-house team of stagers and staging warehouse are exclusive to BREL clients (and included in our commission.)
  • Marketing: Our marketing team focuses on reaching the right buyers, in the right places, using both traditional and digital tactics. You’ll find us on Facebook, Instagram and TikTok – and more than 75,000 people visit our website each month.
• Buyer and Tenant Services:
  • Needs Analysis – We help you understand your options and develop your wish list
  • Referrals to the best mortgage brokers, real estate lawyers, accountants and home service professionals
  • Property search and due diligence; showings and neighbourhood tours
  • Offer strategy and negotiation, Comparative Market Analysis
  • Closing coordination and after-sale support.
• All-inclusive commission – We’re transparent about our commission and pay for professional cleaning, staging, home inspections and more.
• Responsiveness and availability – We pride ourselves on being easy to reach and quick to respond. We’re here to answer your questions and provide guidance whenever you need it.

Case Studies

The Urban Transition

Sarah, recently widowed, moved from her 2,000 sq ft GTA home to a 1,200 sq ft condo near the St. Lawrence Market. Key to Sarah’s success: 

• Started planning one year ahead
• Hired a senior move manager
• Focused on ther most-used and most-loved items
• Chose a walkable neighborhood
• Maintained familiar routines

The Community Switch

Barbara transitioned from her Etobicoke house to a senior living community outside of the GTA. Her successful strategy:

• Visited multiple communities before deciding
• Connected with future neighbors
• Kept favorite furniture pieces
• Created a familiar layout in the new space