Apr 28, 2022

The Best Places to Downsize Your Home

Stuart Mason

As we’ve covered on the Sunbound blog before, one of the most popular trends in senior housing is to downsize to a smaller home after retirement. Downsizing your home can make sense for a lot of reasons and bring a lot of benefits over the course of your retirement. First, many people find that the house they raised their family in is simply too big for their needs once their children are out of the house. While you might need several bedrooms while you’re raising a family, all the extra space often doesn’t make a ton of sense for a couple. Not only does this bring unnecessary upkeep as you’re caring for too big of a home, it can also leave couples paying taxes on too big of a property for their needs. Further, older, bigger homes can be less optimized for aging in place for the simple reason that it often gets harder to navigate stairs, and so a single story home is preferable. Finally, many people tell us how nice it is to just have a small home with limited maintenance requirements as they spend so much of their retirement out and about or traveling.

For all these reasons, it’s no surprise that downsizing when you retire is such a popular trend. While we often talk to people who want to both downsize and relocate to another state for retirement, a study by the Social Security Research Center looked at the question from another angle asking in what states, on average, do you have the greatest chance of saving money when you downsize. In other words, the study looked to determine the cities and states where you could expect to save the most, as well as the least, amount of money when downsizing your home. 

Specifically, the Social Security Research Center created their “USA Downsizing Index” by using the average price of a single family home and a condo in the country’s 50 biggest cities, as well as in each state. The Index, based on Zillow’s estimated home Home Value Index for February 2022, found that in most places downsizing will save you money, with some places saving you a lot more money than others. Interestingly, however, the study also found that in some places downsizing can on average actually cost you more money as in some places the average price of condos exceeds single family homes. The study found that the cities with the highest potential for saving money when downsizing were Arlington, Texas; Las Vegas, Nevada; and San Jose, California. The study found that the states you could expect to save the most money by downsizing were: Nevada, Connecticut, and Hawaii.

Best and Worst Cities for Downsizing

The study found that the cities where you would have the highest potential for savings when downsizing were Arlington, Texas; Las Vegas, Nevada; and San Jose, California based on the cost of a condo as a percentage of the cost of a single family home, as outlined in the graph below. 

Source: “USA Downsizing Index” Social Security Resource Center (2022)

Leading the way was Arlington, Texas where condos were 49.54% less expensive than single-family homes. It’s no surprise to see Arlington, which is in the greater Dallas area, at the top of the list, as Texas is one of the most popular destinations in the country for retirement. Las Vegas, Nevada was the second best place to downsize, with condos being 47.41% cheaper than single family homes. And while it may be surprising to see Las Vegas top the list, Nevada is an incredibly popular retirement destination. The big surprise of the top three is San Jose, California as you rarely see the San Francisco area top any charts for housing affordability. But even though San Jose is one of the most expensive property markets in the country, this study indicates that there may be great value in condos there (at least as opposed to single family homes there).

Another interesting trend was that in the worst cities for downsizing, the study actually concluded that it would be more expensive to find a condo than a single family home. This is surprising as one of the reasons why people downsize in the first place is to move to a cheaper home. In the most expensive cities to downsize, Detroit, Michigan; Philadelphia, Pennsylvania; and Memphis, Tennessee, the study found that it was 260.84%, 33.05%, and 23.17% more expensive (respectively) to downsize from a single family home to a condo. In Detroit, at least, the large disparity is likely explained by the large drop in the value of single-family homes in the city as people and industries have moved out. 

Best and Worst States for Downsizing

As with their analysis of the best and worst cities for downsizing, the Social Security Research Center’s study also found that states range from providing great savings (on average) when you downsize to actually costing you more money when you downsize. Starting with the states where it is the cheapest to downsize, the study found that the best states were Nevada (where condos are 47.54% cheaper), Connecticut (where condos are 43.27% cheaper) and Hawaii (where condos are 39.22% cheaper). These numbers are reflected in the graph below.

Source: "USA Downsizing Index" Social Security Research Center (2022)

Just like with cities, the study also found that there are some states where (based on the value of a condo versus a single family home) you would likely have to spend additional money in order to downsize your home. The states with the lowest potential for savings when downsizing were New York (with condos costing 102.40% more than single family homes), Wyoming (with condos costing 48.52% more than single family homes), and Alabama (with condos costing 26.54% more than single family homes). 

If you’re thinking about downsizing, whether it’s around the block or around the country, give us a shout at info@sunboundhomes.com. We’re always standing by and ready to answer any questions you may have on relocation, retirement, or downsizing. 

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

image caption

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Libero lorem augue neque sed vitae odio consectetur viverra adipiscing. A in viverra sapien, pharetra. Ut nibh fringilla duis sed tellus et eleifend sed feugiat. Ut cursus cursus commodo enim tortor ante etiam. Ultrices adipiscing urna, dignissim viverra integer. Sed dui leo praesent mi, bibendum ultricies diam pharetra. Sed sit facilisi libero, ornare sagittis facilisis purus. Enim, commodo nulla erat amet at ut. Felis, rutrum fringilla consectetur enim consectetur nunc odio. Semper et ipsum, sit fringilla. Auctor arcu, purus mauris arcu massa placerat proin ut. Nunc sit hendrerit enim id ut in aenean amet sagittis. Eget odio integer in pellentesque pulvinar netus.
Adipiscing sit aliquet in massa aliquet ligula auctor gravida arcu. Nisi, at adipiscing consequat, morbi. Varius fringilla non massa lacus cras. Lectus morbi eget vel vel semper.

Read More

Heading

There’s a reason why tens of thousands of people move to Arizona each year.  From the friendly climate, for both outdoor...

Read more

Heading

There’s a reason why tens of thousands of people move to Arizona each year.  From the friendly climate, for both outdoor...

Read more

Heading

There’s a reason why tens of thousands of people move to Arizona each year.  From the friendly climate, for both outdoor...

Read more