Downsizing Without Debt: How More Homeowners Are Buying Their Next House in Cash

Downsizing Without Debt: How More Homeowners Are Buying Their Next House in Cash | Christophe Choo at Coldwell Banker Global Luxury is Your Local Real Estate Expert

If you’ve been thinking about downsizing to lower your expenses, be closer to family, or simply make life easier, there’s a trend worth paying attention to:

More homeowners are buying their next house outright, without taking on a new mortgage. And if you’ve owned your home for a while, you may be able to do the same. No mortgage. No monthly housing payments. Just freedom.

A Record Share of Homeowners Are Mortgage-Free

According to analysis from ResiClub of Census data, more than 40% of U.S. owner-occupied homes are mortgage-free – an all-time high. That means 4 in 10 homeowners own their homes free and clear.

One big reason? Demographics. As Baby Boomers age and stay in their homes longer, many have had the time to fully pay off their mortgages. In Los Angeles and Beverly Hills, where property values have climbed steadily over decades, long-time owners are sitting on extraordinary equity positions.

For example, many Beverly Hills homeowners who bought their properties in the 1980s or 1990s for under $1 million now own estates worth $8 million to $20 million or more. That equity translates directly into buying power for their next home—often allowing them to purchase a luxury condo, pied-à-terre, or smaller single-family residence in cash.

How Downsizers Are Turning Equity into Buying Power

As a homeowner, your equity is your greatest advantage in today’s market. If you’re mortgage-free (or close to it), that equity can give you the ability to buy your next home in cash. That means:

• No mortgage payment in retirement

• Less financial stress as you age

• More cash flow if you purchase a less expensive home

• A faster, simpler transaction with fewer lending hurdles

Here’s how it works: you sell your current house and use the proceeds to buy your next home outright. In markets like Los Angeles, that could mean selling a large Beverly Hills estate and purchasing a luxury condo along Wilshire Corridor, a modern home in West Hollywood, or even a serene downsized property in Brentwood or Santa Monica—without needing financing.

Cash Sales Are Rising

In the latest survey from John Burns Research and Consulting (JBREC) and Keeping Current Matters (KCM), real estate agents reported that the share of all-cash buyers is climbing nationally. In fact, the data shows increases in almost every U.S. region.

In Los Angeles, this is especially true in prime neighborhoods such as Beverly Hills, Holmby Hills, and Bel-Air. Many transactions at the $5 million to $20 million range are cash-based, with international buyers and local downsizers alike choosing to avoid the financing process altogether.

Why? Cash buyers are more competitive. They can close quickly, waive financing contingencies, and appeal to sellers who prefer certainty. If you’re downsizing and buying in cash, you’re positioning yourself with the same strength as the wealthiest global buyers in our luxury marketplace.

Why Downsizing in Beverly Hills and Los Angeles Isn’t a Downgrade

Downsizing doesn’t mean sacrificing your lifestyle. In Los Angeles, it often means upgrading your quality of life. Imagine selling your large estate and moving into a newly built Beverly Hills condo with 24-hour security, valet parking, spa amenities, and walkability to Rodeo Drive. Or perhaps trading a multi-acre property in Holmby Hills for a sleek architectural home in the Hollywood Hills with stunning city views and less upkeep.

For Baby Boomers, empty nesters, and retirees, this can unlock:

• A lock-and-leave lifestyle for travel

• Proximity to family in different parts of the city

• Lower maintenance and carrying costs

• The ability to enjoy Los Angeles without being tied to a large property

Bottom Line

You’ve worked hard for your home. Now it might be time for it to work for you. Whether you’re considering selling your Beverly Hills estate, your Los Feliz architectural home, or your Wilshire Corridor condo, downsizing with cash gives you freedom, flexibility, and peace of mind.

Let’s talk about what your house is worth and how that equity could unlock your next chapter. What would your ideal home look like if you downsized today?

Call Christophe Choo at (310) 777-6342 to tour your future home "HERE" or click "HERE" to estimate your home value