Downsizing Smart: What Canadians Need to Know When Moving from the Family Home to a Right-Sized Property

For many Canadians, “home” has always meant space — kids’ bedrooms, a big backyard, and maybe a basement that’s seen countless family memories. But as life changes, that space can start to feel less like freedom and more like maintenance.

That’s when the idea of “right-sizing” — not just downsizing — comes in. It’s about simplifying your lifestyle, freeing up equity, and aligning your home with the life you actually live today.

Here’s how to make the move strategically and financially smart.

1. Rethink What “Downsizing” Really Means

Downsizing doesn’t always mean moving into a tiny condo. It’s about finding a home that fits your current lifestyle — less square footage, less upkeep, and more flexibility.

For some, that might mean:

• A modern bungalow closer to family

• A smaller condo near transit and healthcare

• A home in another province for a change of pace

Tip: Make a “must-have” vs “nice-to-have” list. It helps you focus on what truly matters when viewing properties.

2. Understand How to Access Your Home Equity

If you’ve built substantial equity over the years, that’s your greatest financial advantage. You can use that equity to:

• Buy your next property outright or with a small mortgage

• Supplement your retirement income

• Pay off debt or invest strategically

Talk to your mortgage advisor about porting your existing mortgage, using a reverse mortgage, or tapping into a HELOC (Home Equity Line of Credit) to bridge transitions.

3. Plan for the Costs You Might Overlook

Selling your home and buying a new one involves more than the sticker price.

Costs to plan for include:

• Realtor commissions

• Legal fees and land transfer tax (varies by province)

• Moving costs and storage

• Condo fees or maintenance charges

• New furniture or upgrades

Swivel Tip: Keep 2–3% of your budget aside for transition expenses. It’s one of the biggest surprises for downsizers.

4. Time the Market — But Don’t Try to Predict It

Many homeowners worry: Should I sell first or buy first?

There’s no one-size-fits-all answer, but a few rules of thumb help:

• In a slower market, sell first so you’re not juggling two homes.

• In a hot market, you may buy first to secure your next home.

• Either way, get bridge financing pre-approved to reduce pressure.

Your mortgage broker can help structure the timeline so your funds flow seamlessly between closings.

5. Consider Lifestyle Beyond the Numbers

The financial side of downsizing is important — but lifestyle matters just as much. Think about:

• Proximity to family and healthcare

• Walkability, amenities, and community

• Lock-and-leave convenience for travel

• Accessibility for future mobility

Sometimes peace of mind and location are worth more than a few square feet.

6. Think Tax and Estate Planning Ahead

When selling your principal residence, the Principal Residence Exemption generally shields you from capital gains tax — but there are nuances if you’ve owned multiple properties.

If you’re also gifting equity, setting up joint ownership, or considering estate planning, talk to both your mortgage and tax advisors early. The right structure can protect your wealth for the long term.

Swivel’s Take

Right-sizing your home isn’t just a financial move — it’s a lifestyle decision that should make your life simpler and your future more flexible.

With the right mortgage strategy, downsizing can:

• Unlock equity for retirement or travel

• Reduce ongoing costs and stress

• Put you in a location that suits this next stage of life

At Swivel Mortgage Group, we help clients across Ontario and Alberta plan these transitions confidently — from financing to timing to protecting equity.

Let’s talk about what your next move could look like.