Choos­ing a smaller home can mean a far fat­ter wal­let

CityPress - - Business - NEESA MOOD­LEY busi­ness@city­press.co.za

For one rea­son or another, you may find your­self in the sit­u­a­tion where you have to change res­i­dences, but re­mem­ber that down­siz­ing does not nec­es­sar­ily have to be a neg­a­tive ex­pe­ri­ence.

There are two main rea­sons that could prompt you to sell your home in favour of a smaller place:

The huge house with a pool and four bed­rooms would have made sense when you had a large fam­ily with kiddy par­ties mor­ph­ing into bois­ter­ous teenage get­to­geth­ers. How­ever, once all your lit­tle birds have flown the coop, the large fam­ily home may start to feel a lit­tle too large for com­fort.

It is of­ten at this point that par­ents opt to sell their homes in favour of a smaller place. You could opt to take on a ten­ant, but larger prop­er­ties are more ex­pen­sive to main­tain and a smaller, lock-up-and-go prop­erty is of­ten a bet­ter and cheaper choice in the long run. A num­ber of fam­i­lies are opt­ing to rent out their large homes while they move to smaller, more af­ford­able prop­er­ties with lower run­ning costs.

When you plan to buy a prop­erty and as­sess its af­ford­abil­ity, you should al­ways build a buf­fer into your cal­cu­la­tions. This en­sures that you will be able to meet your mort­gage re­pay­ments even if in­ter­est rates rise. Of­ten, buy­ers are so caught up in the ex­cite­ment of ac­quir­ing a new home that they fail to con­sider this im­por­tant step in their cal­cu­la­tions and are then forced to sell their homes when they can no longer af­ford the re­pay­ments. If you are fi­nan­cially stressed, down­siz­ing can help you re­de­fine your fi­nan­cial sit­u­a­tion by re­duc­ing your mort­gage or rental re­pay­ment. These are some of the fac­tors you should con­sider:

If you are down­siz­ing for fi­nan­cial rea­sons, look at the public trans­port net­work that ser­vices the area you’re plan­ning to move to. It will make sense to be near a bus or train sta­tion so that you are still mo­bile with­out need­ing to main­tain and run a car. This is also a huge bonus if you are later in the for­tu­nate po­si­tion where you are able to buy a big­ger home again and can then rent out the smaller prop­erty.

When you choose a new home, think about the main­te­nance costs in­volved. If you are mov­ing to a prop­erty in a com­plex, find out who is re­spon­si­ble for gar­den main­te­nance up­front. Also re­mem­ber that face-brick homes are cheaper to main­tain be­cause they do not need a new coat of paint ev­ery few years.

Other main­te­nance costs, such as a pool in the com­plex, are also shared, which means you can en­joy the fa­cil­ity with much less strain on your pocket. A lift in your build­ing may mean more con­ve­nience, but it also equals more costs. Rather look for a smaller build­ing that does not re­quire a lift. Eu­nice Sibiya, the head of FNB’s con­sumere­d­u­ca­tion di­vi­sion, says you may have to in­stall ad­di­tional se­cu­rity fea­tures, such as se­cu­rity beams and bur­glar bars, and these up­grades do not come cheap. How­ever, some land­lords may fork out for these costs up­front to se­cure a “good” ten­ant.

You may also find that ad­di­tional se­cu­rity mea­sures are planned by the body cor­po­rate. Find out up­front, so that you know which costs to fac­tor in.

“Tackle the most im­por­tant ex­penses first, and put your DIY skills to the test. There are help­ful mag­a­zines and tele­vi­sion pro­grammes that give gar­den­ing and ren­o­vat­ing hints and tips,” ad­vises Sibiya.

As for the in­stal­la­tion of your TV and sound ap­pli­ances, take photos of where all the ca­bles plug in so that you can just repli­cate this in your new house – there is no need to pay some­one to do it for you.

“Make a list of the most im­por­tant ad­di­tional ex­penses first and com­pare this against what you are able to af­ford at the mo­ment. Re­mem­ber, cre­at­ing a home is not an overnight process; it takes time,” says Sibiya.

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