If you’re thinking about downsizing, you may be carrying two feelings at once: relief at the idea of less upkeep, and a little dread at everything that has to happen to get there. The house holds years of memories and belongings, and the decisions can seem to stack up faster than you can sort them. It helps to take them one at a time, in the right order. Here’s how we’d walk through it with you if you’re downsizing in Salem, Keizer or elsewhere in the mid-valley: what the next home needs to do, which move comes first, what to keep and which money questions to ask early.
The short answer: downsizing goes more smoothly when you answer three questions before you list: what the next home needs to do for you, which move comes first, and what you will keep. Price and timing follow from those answers. The money questions, including taxes on the sale and what you will net, deserve early attention too, so the decisions you make about the next home rest on real numbers.
What should the next home do for you?
We’d start with how you want to live for the next several years, not with square footage. Write down what matters most, then rank it.
- One level or stairs: a single-level home, or a primary bedroom on the main floor, can matter more than an extra room.
- Yard and upkeep: a smaller lot, or a townhome or condo where the association handles exterior work.
- HOA or not: if a community has an association, ask for the dues, the rules and recent meeting minutes before you write an offer.
- Location: time to family, doctors, church, shopping and the places you already go.
- Storage: room for the things you plan to keep, including a car, a workshop or seasonal gear.
Once you have your list, the Salem and Keizer market reports show what’s for sale and at what prices, so you can see how your wish list lines up with what’s available.
Should you sell first or buy first when downsizing?
There’s no single right order, and the best choice depends on your finances and how much uncertainty you’re comfortable with. Here are the paths we see most often:
- Sell first. This gives you a firm budget and removes the pressure of carrying two homes, but you may need a short-term place to stay.
- Buy first. This lets you move once, on your schedule, but it usually takes more financial flexibility.
- Use a contingent offer or two closings on the same day. These can bridge the gap, with trade-offs of their own.
Our post on selling your home before buying the next one walks through each path in more detail. If you’re buying with a loan, we’d talk with a lender early about what you qualify for before and after the sale.
How do you sort a lifetime of belongings?
This is often the hardest part, and it takes longer than people expect. A few habits help:
- Get the floor plan of the next home, or measure it, and decide which furniture actually fits.
- Start with rooms you rarely use, such as a guest room, garage or attic, before the rooms you live in.
- Talk with family early about heirlooms and keepsakes, so decisions are not rushed during the move.
- Sort into keep, give to family, sell, donate and discard, and schedule pickups or sales on the calendar.
Doing this before you list has a bonus: clearer rooms photograph better and show better. Our post on what to fix before listing covers the rest of the presentation work.
What money and tax questions should you ask first?
Start with what you would net. Our post on what it costs to sell a home in Salem lists the usual seller costs and explains how a net sheet works.
Then ask a tax professional about the sale. According to IRS Publication 523, many homeowners can exclude up to $250,000 of gain from the sale of a main home, or up to $500,000 for married couples filing jointly, if they meet the ownership and use tests, generally owning and living in the home for at least two of the five years before the sale. There are exceptions and special situations, so get advice for your own case.
Finally, look at the ongoing costs of the next home: property taxes, insurance, utilities and any association dues. Our post on how Oregon property taxes work explains why two similar homes can carry different tax bills.
How much should you do to the house before you sell?
Usually less than you think. We’d focus on cleaning, clearing, fixing what is broken and gathering your records, including what you’ll need for the Oregon seller disclosure statement. Our post on the seller property disclosure statement explains what the form asks. Large remodels take time and money, and the next owner may have different taste. Your agent can compare your home with the listings buyers will see and help you decide what is worth doing.
Common questions
When is the right time to downsize?
It depends more on your life than on the calendar. Many people move when upkeep, stairs or distance from family start to shape their days. Look at your finances, your health and where you want to be in a few years. When you’re ready to think it through, a local agent can explain what your home might sell for now and what the next home would cost.
Can you stay in your home for a while after it sells?
Sometimes. A buyer and seller can negotiate a later possession date, or an arrangement for the seller to stay after closing, as part of the sale agreement. Those terms, including any payment, deposits and insurance, should be spelled out in writing. Your agent can tell you whether buyers in your price range are likely to agree.
Should you move into a smaller home or rent first?
Both can work, and each has a clear trade-off. Renting for a while gives you time to learn a new area and avoids buying in a hurry, though it means moving twice. Buying right away gives you a settled home and avoids that second move, but it asks you to decide sooner. We’d compare the monthly costs, the moving costs and how important it is to you to be settled.
Taking the first step
Downsizing is a big change, but it doesn’t have to happen all at once. Decide what the next home needs to do, choose the order of your moves, start sorting early and get your numbers in front of you. The rest tends to follow. If you’re planning a move in Salem or Keizer, a HomeStar Brokers agent can talk through the timing and next steps with you.
This article provides general real estate information and is not legal, tax or financial advice. Talk with a qualified tax professional, attorney or lender about your situation.
