Just after World War II, as GIs returned home and began to raise families, the average American house was 900 square feet. By 1970, bell bottoms were in and the average square footage was 1,300. In 2004, that figure had nearly doubled to 2,330. And homes built in the second quarter of 2008 averaged a whopping 2,629 square feet (it's decreased slightly since then thanks to, um, some recent economic problems). The parents of the largest generation in U.S. history raised their families in houses under 1,000 square feet, so why do we need nearly three times that much space today?
Bigger isn't always better. Large homes cost more to heat and cool (and, as How Efficient Is Your Home? shows, heating and cooling account for the majority of a household's energy use). More bathrooms mean more water use and water-heating costs. Some oversized houses have rooms that are rarely, if ever, used. Bigger homes also cost significantly more in mortgage, insurance, and property tax expenses. And neighborhoods with such homes tend to be far from workplaces, restaurants, and stores, so running errands means driving.
Lots of people are trading their so-called McMansions for smaller, more efficient homes. Not only are they saving money on energy, many also find that a smaller home makes them more aware of consumption (since there's no room for four TVs and three sofas). Downsizing can also bring the family together—replacing, for example, a separate den, media room, and living room with a multi-use family room. And smaller houses are often in walkable neighborhoods where you can get to know your neighbors and spend less time in the car.
Downsizing has a downside: As more people do it, demand for large houses may slack off, making it harder to sell a super-sized home. Selling your current home means you'll probably pay a realtor 6–7% of the sale price, and don't forget closing costs. In addition, moving is disruptive and never cheap, so be sure to take that upheaval and expense into account. Sit down with a calculator and figure out how long it'll take for the reduced costs of your new, smaller home to pay for the moving costs.
As you consider downsizing, think about these questions:
How much do I currently pay for each of these expenses, and how much would I pay for them in a downsized home?:
Heat
Electricity
Insurance
Mortgage
Property and school taxes
Landscaping and maintenance
Would downsizing lower (or get rid of) my homeowners' association fees?
What's a realistic asking price for my current home?
Consult a real estate agent or use www.zillow.com to get an idea of how much homes in your area are worth.
Which rooms in my current home go unused or underused? (This helps you figure out how much square footage you could do without.)
What stuff would I sell, donate, or recycle if I had 50% less space to store it?
In the next 10 years, will my family grow or leave the nest?
What are the schools like in the neighborhood I'm considering?
Would my family use the car more, less, or the same amount in the new home?
What renovations (if any) will the downsized home need, and how much will they cost? (If you're looking to lower energy use and heating costs, for example, don't downsize to a poorly insulated home.)
How much will moving cost?
What other one-time fees (mortgage application fee, assessment, closing costs, and so on) will I pay?
There's more to the downsizing decision than money, of course. If you love your current home or neighborhood, simply find other ways to reduce your carbon footprint and energy costs—the rest of this chapter has tons of suggestions for doing just that.
But the benefits of downsizing are worth considering. You can save money, live more efficiently, and reduce your greenhouse gas emissions, not to mention spending a lot less time on cleaning and yard work. In many neighborhoods of smaller homes, you can leave the minivan in the garage and walk to school, shops, and parks. And you might make friends with the new neighbors as you sit on your front porch.