Where to Start Downsizing: The Conversations to Have First

If you’re wondering where to start downsizing, my advice is simple: have the right conversations before committing to a sale or purchase.

Clarify your budget, where you want to live and whose advice you need. You do not need every detail settled, but you should understand how the next steps fit together.

The first task is not to get the house sold. It is to make sure the next steps work together.

Start with what you can spend—not just what the house might sell for

An appraisal is not a buying budget.

The amount available for the next property needs to account for any debt to be repaid, selling and buying costs, moving expenses and the money you want to retain afterwards.

Tax, superannuation and government benefits may also affect the decision. MoneySmart recommends obtaining legal and financial advice before downsizing and checking how the move could affect any Age Pension entitlement.

Do not assume that calling a property the family home automatically settles its capital gains tax position. Previous rental or business use and tax residency can affect the main residence exemption. Have your tax adviser confirm the position.

The downsizer super contribution rules may also be relevant for eligible people aged 55 or older, but eligibility, timing and suitability need to be checked—not assumed from the name of the scheme.

I would have these conversations before using an expected sale price to decide what to offer on the next home.

No financial adviser? Find the right fit for this decision

A personal recommendation can be a useful starting point, but it should not be the only check.

Look for experience relevant to retirement and property transitions. Check the adviser’s details on ASIC’s Financial Advisers Register, including what they are authorised to advise on. Ask about fees, product-provider relationships and what the proposed advice will actually cover.

You may need advice on a defined decision rather than an ongoing arrangement. Make that scope clear from the beginning.

The aim is not to add another layer of administration. It is to understand the financial consequences while you still have room to choose.

Agree on what the move should change

Before deciding between an apartment, villa or smaller house, talk about where you actually want to live.

Being close to family might mean a short walk, a ten-minute drive or simply remaining in the same part of Sydney. Access to transport and healthcare may matter alongside cafés, community connections and familiar surroundings.

I would turn those preferences into something practical: spend time in the areas you are considering, try the walk to the shops and look at the journey from the street or car space to the front door.

A location that works on a map needs to work in your daily life.

This gives the property search a useful starting point without requiring every feature of the next home to be decided immediately.

Test the timing before choosing a sequence

Selling first and buying first both involve trade-offs. Rather than choosing a rule, I would test the circumstances with your property, lending and legal advisers.

What happens if the existing home sells for less than expected? What if the sale takes longer? What if the right replacement property appears next week?

Selling first can clarify the agreed sale price, but the availability of funds still depends on completion and the financial arrangements. Buying first may secure the next home, but any period of overlapping ownership needs to be affordable.

A longer settlement or rent-back arrangement may help in some transactions, but it needs the other party’s agreement and appropriate legal advice. It is not something to assume will be available. These timing choices are explored further in our existing sell-first-or-buy-first guide.

Choose the selling agent on the proposal, not the promise

I would not appoint a selling agent simply because they suggest the highest price.

Ask which recent sales support their view, how they would market the property, who would handle the campaign and how they will keep you informed.

Then consider whether their proposed timetable suits your move.

You want a clear recommendation you understand—not just an attractive number. For a long-held family home, patience and clear communication should sit alongside relevant sales experience.

Get the right documents reviewed before choosing a living arrangement

A brochure can explain the lifestyle. It cannot replace an assessment of what you are buying and what obligations come with it.

For a strata property, have the records reviewed beyond the latest meeting minutes. Financial statements, the capital works plan, levies, building issues and proposed expenditure all deserve attention. Low current levies do not necessarily mean low future costs.

For a residential land lease community, the usual arrangement involves buying the home and separately renting its site. For a retirement village, the tenure, ongoing charges and departure arrangements require their own review. Do not assume the same fee structure applies to both.

Residential aged care is a separate decision involving care needs and assessment, not simply an alternative form of downsizing property.

My advice is to engage the appropriate legal and specialist advisers early, before an appealing property or an approaching deadline makes it harder to step back.

Where MURRAY LEE fits

We help turn these early conversations into a practical property brief and buying plan.

Depending on the agreed scope, that includes searching for and assessing the next home, assisting with selling-agent selection, coordinating relevant enquiries and representing you in negotiation or at auction through to exchange of contracts.

My sales management background is useful when considering an agent’s proposal and understanding how a purchase is being handled. It does not replace your solicitor’s, financial adviser’s or lender’s expertise.

The appointed selling agent remains responsible for selling your existing home. MURRAY LEE represents you in the next-property purchase and provides the agreed selection and coordination support around the broader move.

You make the decisions. Our role is to help you make them with clearer information and a workable property plan.

You can begin without committing to a move date

You do not have to put the house on the market to make progress.

Start by clarifying the financial position, testing the next-home requirements and identifying the people whose advice you need. Then decide how the sale and purchase should proceed.

The right starting point is not necessarily an appraisal or an inspection.

It is knowing what needs to be confirmed before you say yes.

To discuss the property-related steps in your move, visit the MURRAY LEE Contact page.

General information only. This article does not constitute legal, financial, tax, lending, retirement-living or aged-care advice. Obtain advice appropriate to your circumstances before making commitments.