We help you downsize to a new home,

right where you live

The need to downsize

More and more older Australians are choosing to downsize every day, with the key reasons being:

  • Effort required to maintain a large family home with a big backyard.
  • Inconvenience caused by repairs that come with an aging home.
  • Difficulty in climbing stairs (if living in a double storey house).
  • Existing layout of family home no longer caters to needs.
  • Desire to live in a modern new home that is easy to manage.

A better way to downsize

According to the Government’s MoneySmart Financial Guide, an alternative to selling your home is to convert it to a dual occupancy, namely, subdividing and building two dwellings on it. So, you live in one half and rent or sell the other half.

This could help you avoid or minimise the significant practical and financial disadvantages explained below. If you want to get more details on how downsizing affects your Age Pension entitlements, the Government’s MoneySmart Financial Guide provides a good overview.

Downsizing into an apartment a common mistake

Majority of Australians believe the only way to downsize is to sell the family home and buy into an apartment complex. This is the reason there have been many apartment developments in established suburbs during the past few years. While it may seem attractive to sell the aging family home and downsize into a new modern apartment, there are significant practical and financial disadvantages.

Practical disadvantages of moving into an apartment

Layout and position:

  • Tiny living spaces: Apartments, no matter how spacious they are advertised to be, are actually very small.
  • No room for entertaining guests: The living, dining and kitchen are generally significantly smaller than what you need them to be to entertain guests.
  • Limited storage: There is also minimal storage space, meaning you really have to pick and choose what comes with you to your new home.
  • No space for kids and grandkids: Given how small apartments can be, there may also not be enough room for the kids and grandkids to stay over.
  • Grocery shopping becomes inconvenient: Living in an apartment means you have to carry your grocery from the car park into and across the entry hall, up the lift and across the corridor on your floor before you reach your apartment. And you probably have to make this trip multiple times until all your groceries are cleared from the car boot.
  • Inadequate natural light: Another critical consideration is the position of the apartment. Unlike a house, most apartments have windows only on one side of the wall. This means you really need to pick an apartment with the living area facing the right way (with north facing the best) in order to get ample sunlight.
  • Poor quality: It is no secret that apartments are built to maximise profit. To achieve the highest return developers can at times compromise on the quality of the fixtures and fittings, insulation and other building materials, and even skimp on specialist tradesmen. This often leads to a substandard finish, giving rise to horror stories such as flooded basements, leaks and paper thin and cracking walls.
  • Noise pollution: Apartments are mostly built on main roads where noise pollution is worst. When you combine this with a substandard build and inadequate insulation, the noise pollution can become a major nuisance.
  • Risk of noisy or unpleasant neighbours: You would have up to 4 neighbours sharing a wall with you (on your left, right, right above and below), meaning anything they do in their apartment could have an impact on you.
  • Possibility of strangers living next door: Apartments are generally used as rental properties, meaning potential high turnover of tenants. You may get a new neighbour every 12 to 24 months.


  • Unfamiliar location: It is difficult to find the right area that you would want to move into. In many cases, this means moving into a location that you are not familiar with and you have to learn and adapt to the new surroundings.
  • Away from family and friends: Moving into a new area means you are further away from friends and family, which can be difficult and stressful.
  • Having to alter existing habits: You should be prepared that the local shops don’t do coffee or serve the type of food that you are used to.
  • Leaving behind fond memories: You need to also manage the emotional rollercoaster ride of leaving the area where your kids grew up in, and where many fond memories were formed.

Financial disadvantages of moving into an apartment

  • Minimal capital growth: When you buy an apartment, you are buying an asset with minimal growth potential.
  • Insufficient funds for future retirement home: This issue is especially important if you want to keep the option of moving into a retirement home open. The reality is, as people get older, the need for full time care no longer becomes optional. One of the biggest drawbacks of selling your home and buying an apartment is: when you need to put down a deposit for a retirement home, you may not have enough equity in the apartment to do so.
  • Tax implication and impact on Age Pension entitlements: When you sell your home and buy a new one, you are liable for stamp duty, and any cash that is freed up may be assessed as income and affect your pension.
  • Receiving a lower price for your home: If you follow the news, you would have heard that house prices are falling at their fastest pace since the Global Financial Crisis, with Melbourne overtaking Sydney as the weakest housing market (according to latest CoreLogic data). The below graph shows the sharp drop in the median house price for Melbourne post August 2018, going from $2.30 million to $1.42 million (a 38% drop). This means if you sell your home now, you could be adding 38% less cash to your nest egg.

home downsizing services

Downsizing case studies

Disclaimer: The case studies below are simplified illustrations that do not take into account your personal situation, and should not be taken as financial advice and acted upon.

Case study 1: Barbara Smith sells the family home and purchases a unit

Barbara sold her home for $1.3m in 2007, bought a unit for $650,000, paid stamp duty of $35,000 and had  $615,000 cash remaining:

When Barbara was 70 in 2007, she and her husband sold their home in Kew for $1.3 million and bought a unit for $650,000. After paying stamp duty of $35,000, they had $615,000 left, which was counted towards the assets test for their Age Pension.

Today, the unit is worth $720,000, while the sold home is worth $2.3m:

Fast forward 11 years and at 81 now, Barbara and her husband find the need to move into a retirement home. Their $650,000 dollar unit is now worth $720,000, an appreciation of only $70,000. Their old house in Kew has risen from $1.3m to $2.3m (based on recent sales for similar homes in the area), an appreciation of $1.0m.

Over the past 11 years, they spent $330,000 of $615,000 cash on living expenses and holidays, with $285,000 remaining:

Over the past 11 years, she and her husband spent an average of $20,000 a year on living expenses, and $10,000 a year on holidays. So, their total spend was $330,000, with $285,000 now remaining in the bank.

Now, they decide to move into a retirement home but need $1.0m deposit. Once they sell their unit and withdraw the $285,000, they have $5,000 remaining; and they no longer have assets to pass on to their children:

A deposit for a retirement home of their choice is approximately $1.0m today. If they sold their unit for $720,000 and withdrew the remaining cash in their bank, they would have just enough for the deposit. Without any other sources of income, they now have to rely on their Age Pension and what is remaining in their Super for the next chapter of their life. Having also sold their remaining asset, they have no more assets to pass on to their children.

Case study 2: Pamela Lee converts her home into a dual occupancy and downsizes into one of them

In 2007, Pamela converted her home to a dual occupancy, with total assets worth $2.6m:

Pamela, Barbara’s neighbour was 71 in 2007 when she decided to convert her home to a dual occupancy and live in one while renting out the other. She and her husband spent $900,000 on the build, funded through a combination of life savings, superannuation and loan. By the time they moved in, about 2 years later, each of the new dwellings was worth $1.3m (based on sales of similar new homes in the area in 2009), meaning they held assets worth $2.6m in total.

Now, they decide to move into a retirement home and require $1.0m deposit; and their dwellings are now worth $4.0m:

Fast forward 11 years, Pamela, now 82, and her husband decide to move into the same retirement home as Barbara. The deposit required is also $1.0m. Each of their dwellings is now worth $2.0m (based on recent sales of similar homes in the area), so they hold assets worth $4.0m in total.

Over the past 11 years, they spent $330,000 on living and holidays, but the rental property earned them $275,000 – meaning only $55,000 was funded by existing savings:

In the past 11 years, Pamela and her husband’s expenses have been very similar to her neighbour Barbara’s. They spent $20,000 a year on living and $10,000 per year on holidays, totalling also $330,000 across the 11 years. The second dwelling that they rented out brought in on average $25,000 per year, so $275,000* over 11 years – meaning only $55,000 were actually funded by existing savings.

*Note: The actual amount received is less due to tax implications, and rental income may impact Age Pension entitlements.

They sell both dwellings to cash out $4.0m for retirement home and future living expenses:

Pamela and her husband decide to sell both properties and cash out the $4.0m^ dollars to fund the deposit for the retirement home and their living expenses for the next chapter of their life.

Let’s compare Barbara and Pamela’s decisions

Pamela chose to put out $900,000 to build a dual occupancy. Her family also spent $330,000 on living and holidays from their savings. For Barbara, these expenses came out of the proceeds from selling her home. However, in the 11 years, Pamela’s decision and initial investment brought her family $275,000 in rent, meaning they actually only spent $55,000 on living and holidays.

After selling the two dwellings for $4.0m and paying $1.0m in deposit for the retirement home, Pamela and her husband have $3.0m in cash remaining. This is the financial return on their decision back in 2007.

To compare likes with likes and work out a comparable return, we need to take the $55,000 from the $3.0m, as well as the $900,000 outlay Pamela used to build the two dwellings. Hence, the net return from their decision is:

($4.0m proceed from home sale – $330,000 living & holidays + $275,000 in rental income – $900,000 in dwelling construction cost – $1.0m deposit for retirement home) = $2,045,000^ net cash remaining in the bank.

^Note: This has tax implications and may impact Age Pension entitlements.

For Barbara, their net return is:

($1.3m proceed from home sale – $35,000 stamp duty on unit purchase – $330,000 living & holidays + $70,000 in capital growth from unit – $1.0m deposit for retirement home) = $5,000 net cash remaining in the bank.

As you can see from the case studies, Pamela’s family is more than $2.0m better off than Barbara’s family after 11 years. Despite the original outlay of $900,000 to build a dual occupancy, they have achieved a net cash position more than double what they put in. Apart from the financial gains, Pamela’s family has also been able to avoid all of the other practical problems of downsizing stated above.

If Barbara had chosen to put her savings to work, or taken out a loan for the build, like Pamela did back in 2007, her family would be in the same position now.

How we can help you in your downsizing journey

We are professional property developers that help older Australians downsize right where they live today. We help our clients capitalise on the potential of their land by building two, or more, homes on their property. This allows our clients to downsize into one and rent or sell the other for a profit.

We specialise in helping downsizers because we ensure the layout of the new house suits their current and future lifestyle; and we manage the entire process end to end, including helping with any temporary relocation or storage needs.

By converting your single home into two, or more, dwellings and downsizing into one of them, we can help you avoid the practical and financial disadvantages stated above.

Why choose us?

We are specialists in helping older Australians downsize.

  1. We work with architects who specialise in designing homes for downsizers. By making clever design choices – such as sustainable gardens, compact lift, wide hallways, easy-grip cavity slider doors, having more under-bench drawers than cupboards, and easy-to-reach light switches and power points – you are able to stay in your home for longer.
  2. We manage the whole process end to end, from supervising the build, finding you temporary accommodation, if required, to moving and storing your belongings. Once your new home is complete, we then move all your belongings back.
  3. We can also assist with financing the build, if required, by raising funds from our network of investors.

You can visit our Projects page and view some recent projects for our clients. The Process page also contains summary information on what the process is like once you engage with you.

Call us for an obligation free chat

Our office address is: Level 2, 541 Blackburn Rd, Mount Waverley VIC 3149. Please call our office on (03) 9103 1307 to set up a time with us, and we will run through our services in more detail and answer any questions you have.

We look forward to meeting you soon.

If you know of someone who would benefit from our services, please feel free to pass on our contact details. We would be happy to assist them in any way we can.