The dish on downsizing

By: Sarah Wojcik | Metro | Published July 14, 2021

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METRO DETROIT — The choice to downsize comes with a slew of benefits, including decluttering, lower mortgage payments, less maintenance and more money to save or invest.

With the sizzling-hot seller’s market and the dizzying amount of decisions that accompany downsizing, experts and a local resident going through the process advise being patient and allowing enough time to pack at a leisurely pace.

Debbie Robbins, a Realtor with ReMax who has been serving the tri-county area for 20 years, said many of her clients are empty nesters in colonial homes looking to relocate to a ranch.

“It doesn’t necessarily have to be a smaller ranch,” Robbins said. “(People) want to have a home big enough for them to have their family come and stay with them, and they want a little bit more space for themselves.”

Instead of the term “downsizing,” Robbins said she prefers to use “right-sizing.”

Packing up
“People may want to get rid of a lot of stuff — kids’ football trophies and Little League awards,” she said. “I usually recommend getting over to the new place just to see what it looks like, get to know the size of the place, and take things with multiple purposes.”

For example, a dresser can serve as a TV stand as well as storage for items such as photo albums or bills. Most people no longer need table service for 12 — Robbins recommends keeping service for four and donating the rest.

“We only wear 20% of the clothes we have in our closet,” she added. “You want to take things you can wear in different seasons. Layering is always good. And you don’t need the Costco storage room.”

With the advent of digitalization, homeowners can downsize space-consuming photo albums to a small flash drive, which can be plugged into a digital picture frame or stored on a hard drive, Robbins said.

Giving sentimental items away to family members can help clear the way for moving into a smaller space, as well as donating furniture to charities or books to libraries.

“One of the tips I give my clients is to work for 20 minutes at a time. Everybody can set aside 20 minutes. Set a timer, and if you want to keep going, set the timer for another 20 minutes,” Robbins said. “Another idea is to put a plastic bag or some boxes either by your closet or by the front door. If I pick up something I haven’t used in five years, I put it right in the box.”

Warren Agee, owner of Troy-based home organization company Warren Agee Designs, advises starting the packing process at least three months in advance.

“The sooner you start, the less stressful it is for you,” Agee said. “Start in small sections. Don’t try to tackle an entire room or an entire space in one day.”

He advised sorting possessions into four categories: keep, donate, sell, and trash or recycle. When it comes to sentimental items, he recommended taking photos of things that will not fit into the new space to remember them.

When it comes to a large collection of T-shirts, he added, a good way to downsize is to cut them up and turn them into a quilt — both sentimental and useful.

“If you’re able to get into the new space to measure it before you actually get there, this will also help you determine how much stuff to take and how much stuff you have room for, instead of taking everything, cramming it in and taking some of it back out,” Agee said.

When packing, he also recommended using smaller boxes instead of large ones, which can get heavy quickly and be difficult to move.

“Label, label, label, label, label, label,” he stressed. “Try to be as specific as possible, so you know exactly what’s in each box and you’re not guessing. If you have a room that’s not being used, it’s great to start getting boxes stacked up nice and neatly, so when the time comes, you can move everything from one room.”

When deciding what stays and what goes, Agee said to get rid of all duplicates, as well any items not used on a regular basis.

“For closets, I notice a lot of people put jeans on hangers, which takes up a lot of room,” he said. “You save so much room if you take them off the hangers, fold them and put them on a shelf. The same goes for T-shirts.”

He added that he likes to coordinate closets by color, which can make clothes appear neater as well as be easier to find.

“If downsizing in a pantry, put one can of soup or beans out, preferably one that is about to expire, and the rest down on the floor in a bin,” Agee said.

Financial considerations
Dewey Steffen, CEO of Great Lakes Wealth in Northville, recommended hiring a financial consultant when embarking on the downsizing process.

From a financial perspective, he recommended selling items through Facebook Marketplace, a garage sale or on eBay, and to look into tax credits for donating to charities, such as Salvation Army or Habitat for Humanity.

Steffen also advised to take photos and videos to document the interior and exterior of the new home for insurance purposes, in case of a fire or larceny.

“It’s also the perfect time to review retirement plans,” he said. “If you’re downsizing, you need to make new assumptions about your cash flow and monthly costs. Hopefully, your monthly costs are less so you have more money for investing or just living better.”

Consulting a financial planner can help homeowners determine how much of the sale of the previous home to put toward the new purchase and how much to invest.

“One of the things before even considering downsizing is making sure you know how to pay for the place. Retired people can’t get mortgages because they need earned income,” Steffen said. “We can calculate how much of a mortgage you can afford.”

He recommended getting an estimate of the worth of the new home, factoring in fees and interest rates, and placing a down payment of at least 20% to avoid having to pay private mortgage insurance.

“The house is usually the biggest expense for anybody,” Steffen said. “According to the U.S. Census Bureau, home equity makes up about 70% of someone’s net worth.”

According to a 2018 report from the U.S. Bureau of Labor Statistics, he added, housing expenses are on average the largest item in a family’s budget — approximately 30%-35% of Americans’ spending.

“Housing is the biggest expense and potential wealth,” he said. “People need to understand both sides.”

Firsthand experience
Nancy Padilla, a Bloomfield Township resident, and her husband, Bob, are among those downsizing to a smaller home. They began looking for a new place in January and found one in May.

The couple purchased their 4,000-square-foot colonial on Stoneleigh Road in 1990 and raised three children. They are now empty nesters and will be moving approximately 5 miles to a 2,100-square-foot ranch on a corner lot in Bloomfield Township in early August.

Padilla said they began contemplating downsizing about three years ago, when they started building a house up north in Mackinaw City.

“We knew that we would have two big houses and that we would be looking for a smaller one downstate,” she said. “We raised our family there, and we had quite a few empty bedrooms and bathrooms. For the two of us, it’s a lot of upkeep.

“It’s a house that’s meant to be filled with children and a family,” she continued. “With just the two of us, it feels very empty, and it’s more space than we need. It was wonderful when it was filled with our kids and their friends, but there’s an empty feeling to it now.”

With the new build now complete, Padilla said the question of what to do with their many possessions accrued over 31 years was partially solved by bringing them up north to furnish the new home.

They still had to find ways to get rid of quite a few things, though.

“There was quite a bit that we donated to local charities, and some things had to go by the curb,” she said. “We also had the three kids come and claim things.”

Padilla said the pair knew they wanted to stay in the same area because their children all live within 45 minutes, plus they wanted to continue seeing their medical providers and friends, and frequenting their favorite businesses.

“We definitely were looking for a ranch, and we were looking for a yard that was a bit smaller and less upkeep,” she said. “We wanted to only need some cosmetic changes to make it our own; we didn’t want a place that needed major remodeling.”

She recommended those looking to downsize be patient and find something they want, because there is a good chance it will serve as home for the remainder of their days.

“We have a lot of nice neighbors. A neighbor we’ve known for a long time moved out of our neighborhood five years ago and downsized. … Now we live across the street,” Padilla said. “This is a new phase, and we’re excited about it.”