How to Downsize Your Home and What to Expect

downsize-moving-boxes-houseIf you are considering moving from a larger home to a smaller one, it’s important to know what to expect from the process. As a first step, we recommend meeting with real estate and mortgage professionals, who can help you find the option that best fits your lifestyle. Have you recently retired? Are you in financial straits? Are you looking for less maintenance? The answers to these questions play a key role in helping you make the best decision, particularly in the competitive real estate market that is the New York Metro Area. Here are some other important questions you should ask.

Questions to Ask Yourself

  • What are the things I value most in a home?
  • How important is the size of my home?
  • How will other life events (e.g., “My son just graduated from Rutgers and needs to move home”) affect my living in a smaller home?

Questions to Ask your Mortgage Consultant

  • At what price do you think my house will sell in the current market, and why?
  • What will I pay in closing costs?
  • How much, if any, of the earnings from the sale of my current home will cover the cost of buying my new home?

Smaller Home, Smaller Mortgage?

As with almost everything, there are advantages and disadvantages that come with downsizing. Although there are often financial benefits to moving from a larger home to a smaller model, there are also few drawbacks to consider. Making a list of the pros and cons can help. Here are a few points from each side of the coin to get you started.


Long-term financial freedom – One of the financial benefits many people enjoy when downsizing is a smaller mortgage payment. This is typically the largest of the monthly bills, so if you’re able to lower this commitment, you may find that you have more financial flexibility.

Lower property taxes – Along with potentially lowering your mortgage payment, you may also realize financial relief in another way. Because assessors determine your tax rate based on the value of your house, downsizing may lower your property taxes.

Less maintenance – Anyone who’s owned a large home understands how much upkeep it requires. Getting a smaller place can eliminate some of this maintenance, freeing up money and time.


Moving costs – In addition to the standard closing fees associated with purchasing a home, there are other expenses. Consider, for example, the costs of hiring a moving company or renting vehicles and equipment to do it yourself. You may have to budget for storage space if there are items you can’t fit in your new home but don’t want to part with.

Replacing furniture – Downsizing can apply to furniture as well as your home. This not only means you may have to sell or give away items that you’d rather keep, but you’ll also have to purchase appropriately sized replacement pieces. Smaller furniture can cost less, depending on your taste, but this is a potentially considerable investment worth thinking about.

Tough decisions – Moving from a home filled with memories — not to mention neighbors and other ties to your North Jersey community — may be difficult for you, your children or other family members. Additionally, fewer rooms mean less storage space. This may require you to part with some antiques, family heirlooms or other treasures.

If financial savings are the main reason you’re considering downsizing, it is crucial to do the math before taking action. Here’s why: you’d need to scale down considerably in order to make a truly substantial difference in your mortgage savings. For example, purchasing a home that is $50,000 cheaper than the one you have might only save you $300 to $400 on your mortgage payment. Whether or not that justifies moving ahead is up to you!

Owning vs. Renting

If you are pondering not just moving from a larger home to a smaller house, but going from owning to renting, a slightly different set of factors must be considered. The debate over owning vs. renting is controversial. According to the National Association of Realtors, some five to six million downsizing baby boomers will sell their homes and sign rental leases over the next decade. This prediction comes despite the Mortgage Bankers Association’s Research Institute for Housing America recently declaring that retirees who own homes tend to fare better financially than those who rent. Choosing the best option for you depends on your lifestyle, needs, and real estate market.

Don’t feel you need to go through this process on your own. With headquarters in Englewood, New Jersey and branches located throughout Northern New Jersey, the professionals at NVE live and work locally, providing them with the ability to offer you expert guidance with a local point of view. No matter what stage of life you’re in, NVE Bank has you covered with great mortgage loan products and services, and our award-winning Mortgage Specialist will lead you through the often difficult and confusing process of choosing and getting the exact loan that meets your specific needs. Call 1-866-NVE BANK (683-2265) or e-mail You can also visit one of our 12 convenient neighborhood branches.



About NVE Bank

The NVE Blog should not be used for banking purposes relating to NVE Bank. Please do not disclose any personal or business banking information on this site. NVE is an Equal Opportunity Lender, Equal Housing and Member FDIC. Visit NVE Bank, established in 1887, offers an extensive range of personal and business products and services. The Bank maintains 11 offices conveniently located throughout Bergen County. For more information, please call our toll-free number 1-866-NVE-Bank (683-2265) or visit our website at
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