Command to change the default home directory of a user

The accepted answer is faulty, since the contents from the initial user folder are not moved using it. I am going to add another answer to correct it:

sudo usermod -d /newhome/username -m username

You don't need to create the folder with username and this will also move your files from the initial user folder to /newhome/username folder.

Found out that this breaks some applications, the better way to do it is

In addition to symlink, on more recent distros and filesystems, as root you can also use bind-mount:

mkdir /home/username 
mount --bind --verbose /extra-home/username /home/username

This is useful for allowing access "through" the /home directory to subdirs via daemons that are otherwise configured to avoid pathing through symlinks (apache, ftpd, etc.).

You have to remember (or init script) to bind upon restarts, of course.

An example init script in /etc/fstab is

/extra-home/username /home/username none defaults,bind 0 0

You can do it with:

/etc/passwd

Edit the user home directory and then move the required files and directories to it:

cp/mv -r /home/$user/.bash* /home/newdir

.bash_profile
.ssh/ 

Set the correct permission

chmod -R $user:$user /home/newdir/.bash*

usermod -m -d /newhome username