If you need the equity from your current home to fund the next purchase, selling first is usually the practical starting point. Buying first may make sense if you can comfortably own both homes for a period and have found a replacement that meets your needs. Before choosing, compare your likely sale proceeds, financing, moving options, and the homes actually available.

After years in a Palos Verdes home, the decision to downsize can stall over one question: Where will I go after I sell? You may want less maintenance, fewer stairs, a smaller yard, or more freedom to travel. You may also want to stay close to the people and places that make this community feel like home.

As a Palos Verdes Realtor serving the Peninsula and South Bay since 1990, my recommendation is to plan the sale and the next move together. A price for your current home is useful, but it is only one part of the decision. You also need a realistic picture of what comes next.

Start with the home you want next

Before deciding which transaction comes first, define what you want your next home to do for you. A smaller property is not automatically an easier property to live in.

For example, a condo with fewer square feet may still have stairs between the garage and the front door. A single-level house may have a sloped driveway or a yard that needs more attention than you want. A townhome may simplify exterior maintenance while introducing association dues and shared decisions about repairs.

I suggest making a short list of the features that would improve daily life: the route from parking to the kitchen, the location of the bedroom and laundry, outdoor upkeep, room for guests, and proximity to your regular activities. Then compare actual homes against that list.

Whether you hope to stay in Palos Verdes Estates, Rolling Hills, Rolling Hills Estates, or Rancho Palos Verdes, test your budget and requirements before committing to a move-out date. If very few available homes fit, that should influence the timing of your sale.

When does selling first make sense

Selling first is often the stronger starting point when your next purchase depends on the proceeds, when you want a clearer budget, or when carrying two homes would create uncomfortable pressure.

Once the sale closes, you know what you actually received. That can make it easier to set a purchase budget and make an offer without a condition requiring your current home to sell. An accepted offer on your existing property is progress, but the proceeds are not available until the transaction closes.

The tradeoff is where you will live if the next home is not ready. Before listing, consider whether a temporary rental, a stay with family, or a negotiated period in your current home would be workable. Include storage, pets, accessibility, and the cost of a second move in that discussion.

Selling first is easier to evaluate when temporary housing is a real option with an estimated cost. Without that plan, an approaching move-out date can make an unsuitable replacement home feel more attractive than it should.

When does buying first make sense

Buying first can be a reasonable choice when you can fund the purchase independently of the sale and comfortably carry both properties if the sale takes longer than expected.

It can give you time to move at your own pace, make changes to the new home, and prepare the existing property for photographs and showings after you leave. It may also be worth considering when you find a home that satisfies requirements that have been difficult to meet.

Before committing, ask your lender to confirm your purchasing capacity while you still own the current home. If you are considering temporary financing, have the lender explain qualification, fees, repayment requirements, and what happens if your sale is delayed. Having substantial equity does not automatically mean that equity is available to spend.

I would also review a slower-sale scenario: What would it cost to carry both properties for several additional months? Would you still feel comfortable if the sale price were below the optimistic end of the estimate? The purpose is to choose a plan you can sustain without feeling pushed into a rushed sale.

Compare the three main approaches

The right choice depends on which tradeoff you can comfortably manage. A coordinated closing is a goal to work toward, with a backup plan if either transaction changes.

Can you downsize without moving twice

Sometimes. A negotiated closing schedule or temporary occupancy after your sale may help you move directly into the next home. Those arrangements depend on agreement between the parties and any lender or insurance requirements.

A post-closing occupancy arrangement, often called a rent-back, allows a seller to remain for an agreed period after the sale. If that would help your move, raise it early so it can be considered with the offer. The written terms should address the move-out date, payment, deposits, insurance, maintenance, and responsibility for damage.

A home-sale contingency is another possible tool: your purchase contract may make the purchase dependent on selling your current home. The seller must agree, and the exact wording and deadlines matter. Your agent should explain how that condition affects your offer and what protections the signed contract provides.

Even when dates appear to align, keep a practical backup for a closing delay. A few nights of temporary accommodation are a different problem from needing an open-ended rental; plan for the possibility that fits your transaction.

Look at the full cost of the move

A lower purchase price does not tell you how much money downsizing will free up. I recommend comparing both the one-time transition costs and the ongoing cost of living in the replacement home.

Sale proceeds: Use a realistic price range, then account for mortgage payoff, agreed selling expenses, preparation, and any estimated taxes.

Purchase costs: Include the down payment or cash purchase, closing costs, moving, and work needed before you settle in.

Monthly ownership costs: Compare financing, property taxes, insurance, association dues, utilities, and maintenance.

Transition reserve: Set aside an amount for overlapping ownership, temporary housing, storage, and unexpected timing changes.

For a financed purchase, the Consumer Financial Protection Bureau’s Closing Disclosure guide explains how to review cash needed at closing, monthly payments, and taxes or insurance that may be paid separately. Obtain property-specific estimates rather than assuming a smaller home will cost less in every category.

How does Proposition 19 affect selling first or buying first

For eligible homeowners who are at least 55 when the original home is sold, Proposition 19 may allow a transfer of taxable value to a replacement primary residence anywhere in California. The replacement must be purchased or newly constructed within two years before or after the sale. A higher-value replacement can require an adjustment, and a claim is required. See the California Board of Equalization’s Proposition 19 fact sheet.

Buying first has a timing consequence: the transfer takes effect at the later transaction. The BOE says the replacement home is taxed at its full fair market value until the original home sells, with no refund for that interval. Review the BOE’s Proposition 19 questions and answers and confirm your plan with the replacement county’s assessor and your tax adviser before relying on a projected tax bill.

Property-tax planning is separate from income tax on a home sale. The IRS home-sale exclusion may exclude up to $250,000 of gain, or $500,000 for qualifying married couples filing jointly, subject to eligibility rules. Have your tax adviser estimate your situation; buying another home does not by itself eliminate taxable gain.

How I would help you build a downsizing plan

My starting point is a conversation about what you want to change and what you want to keep. From there, we can work through the decisions in an order that makes the move easier to evaluate.

1. Estimate the current home’s market value. Review comparable sales, condition, location, and the preparation that may be worthwhile before setting a realistic range.

2. Explore the replacement options. Look at homes that match your daily needs and budget, including the details that are easy to miss in online photographs.

3. Confirm the financial boundaries. Coordinate the sale estimate with the guidance you receive from your lender and tax adviser.

4. Choose a sequence and a backup. Decide whether selling first, buying first, or coordinating the transactions best fits your circumstances.

5. Plan the preparation and move. Build a preparation and marketing plan, with a manageable schedule for belongings, repairs, and relocation, before accepting dates that would be difficult to meet.

For a broader overview of preparing, selling, and moving, visit my Palos Verdes downsizing guide. You do not have to sort every closet or decide where to move before starting the conversation.

Frequently asked questions about downsizing in Palos Verdes

Can I start looking for a smaller home before I am ready to sell

Yes. Early research can help you test your budget and preferences without committing to a purchase. I recommend distinguishing between exploring possibilities and entering a purchase contract with deadlines and financial commitments.

Does downsizing mean I have to leave Palos Verdes

No. You can explore a smaller house, a home with a more practical layout, or a condo or townhome within the Peninsula. Whether a particular option works depends on availability, price, access, ongoing expenses, and your needs.

Should I renovate before selling a longtime family home

Get a property-specific assessment before starting a major project. Some homes may benefit from selected repairs and presentation improvements; others may be better offered with their current condition reflected in the pricing and marketing. Evaluate the cost, time, and likely buyer response.

What if I find the right home before mine is listed

Review your verified purchase capacity, the readiness of your current home, and the seller’s willingness to consider your proposed terms. A desirable home is a reason to evaluate the options promptly, while keeping the financial limits and contract deadlines clear.

How far in advance should I contact a downsizing Realtor

Contact a Realtor when you begin seriously considering a move, even if your timing is uncertain. Starting early gives you room to explore neighborhoods, assess your current home, and organize the next steps without an immediate listing deadline.

Start with a private Palos Verdes downsizing conversation

If you are considering selling a longtime home in Palos Verdes or the South Bay, I can help you evaluate its market position, explore your next-home options, and create a realistic sequence for the move.

Request your complimentary Palos Verdes downsizing plan. Call 310-528-7480 or visit my downsizing resource page to request the free guide and connect with me.

We can begin with your questions and work toward a timeline that fits your circumstances.

About Suzanne Dyer

Suzanne Dyer is a Palos Verdes Realtor with Strand Hill | Forbes Global Properties. She has served Palos Verdes and the South Bay since 1990, with more than 1,000 homes sold and over $1 billion in career sales. Her residential expertise includes luxury homes, equestrian properties, downsizing, and trust and estate home sales. California DRE 01054310.