Dear David,
We live in a large two-storey home. Our kids are grown and we are currently mortgage free. Health issues are making it hard for us to maintain this property. We’re thinking a bungalow-style townhome might be a better fit for us and our small dog. Will high interest rates affect our ability to downsize? – LOOKING FOR THE RIGHT FIT
DEAR LOOKING: It seems like interest rates are a hot topic in every real estate conversation these days, whether its first time buyers breaking into the market, families focused on making mortgage payments, or downsizing seniors wondering if they’ll have cash left over after moving into a smaller house.
Many factors affect how your move will play out financially, including the style of your home. Bungalows typically command a higher price per square foot than two-storey houses, so depending on the size of bungalow you purchase, a home with less square footage may not necessarily translate into a dramatically lower purchase price.
From a liveability and maintenance perspective, I support the notion that a bungalow-style townhome would be a great fit for you. While bungalow towns are a bit harder to come by than traditional two-storey models, there are plenty of options available. It’s important that you share your home buying wish list with your Realtor so they can zero in on exactly what you’re looking for. Pets in particular can sometimes present a challenge, as several adult lifestyle communities in our area have no-pet policies. Pet-friendly options are available of course, but it’s important to note the rules at each location if downsizing with a four-legged family member.
With interest rates declining, it’s worth doing the math on several different options to narrow down the best combination of price, location and amenities. Some of our local communities are downright resort-like, with a pool, tennis courts and recreation centre. Others provide maintenance and will mow your grass and shovel snow to your door. Some complexes offer little more than a common address, so put your Realtor to work finding a perfect match for your ideal lifestyle.
When you’ve narrowed down a few good options, have your Realtor pass along the numbers so you can bounce them around. If you can buy without a mortgage, current interest rates won’t affect you in any significant way. Many downsizing seniors do opt for a small mortgage, to help secure an ideal living situation with the services and amenities they desire. Fortunately, a small mortgage leaves you much less affected by interest rates than if you were carrying a million-dollar mortgage and buying at the top end of what you can afford.
PRO TIP: A small mortgage payment of a few hundred dollars per month can be thought of in terms of a condo fee, if that’s what it takes to get you into your perfect home. #Advice #AskDavid #TheNegotiator
David is a top-selling Broker in Kitchener-Waterloo Region. He works personally with you when selling or buying your home. Call or text today for your free home evaluation! 519-577-1212.
