How Downsizing Can Actually Cost You More
You may have lived in a big St. Louis house for the last 25 years, but now it’s time to downsize. The kids are grown, and you’re tired of cleaning a big house. You also want to save money.
But what you don’t know is that downsizing can actually cost you money if you’re not watching yourself. Here is how downsizing can actually cost you more in St. Louis.
Tax Costs
St. Louis homes appreciate over the years, and if you’ve been living in your home for 25 years, then it’s probably appreciated quite a bit. You may have to pay what is called a capital gains tax. If you’re married, you and your spouse can file jointly and be exempt for $500,000 of your sale. If you’re filing as a single, you’re exempt from $250,000.
To calculate this tax, speak with your accountant. The IRS has complicated rules for this tax, so it is best to speak with an expert.
Repairs to Your St. Louis Home
Before you sell your St. Louis home, you need to make repairs to anything broken or not working correctly, such as light switches that no longer work or stoves with burners that no longer light. It may seem counterproductive to fix up a St. Louis home you’re selling, but it’ll help you once an offer comes in.
Your buyer will have a home inspection done and discover these problems. They’ll use those repair costs to negotiate down to a lower price. Fix up your home to get a good price for it. Don’t forget to touch up your landscape too.
Moving Costs
Chances are you have way too much stuff to load it all in a few of your friends’ cars like you did in college. To get everything moved safely and on time, you’re going to need to hire a moving company.
Moving costs vary depending on where you’re moving too and how much stuff you have. Get a few estimates from different moving companies before making a decision. You can also try to move in the offseason when fewer people are moving. You’ll avoid moving company surge charges.
Storage Fees
What do you do when you have too many possessions and a smaller house? If you’re not willing to part with some of your possessions, you’ll need to rent a storage unit.
The best way to avoid this cost? Get rid of your possessions. You probably have clothes you don’t wear, computers and TVs that don’t work and old toys that no one plays with any more. Have a garage sale, donate or recycle your belongings. You’d be surprised how much space you have when you actually look for it.
New Local Living Expenses
Are you moving from a house in the country to a condo in a community? If so, then you might have to pay homeowner’s association fees. That’s an added cost. Or maybe you’re moving to an area with higher property taxes. That’s another cost.
This cost varies depending on where you move to, but you should keep it in mind.