A couple who decided to move to Raleigh, where their children live, recently requested advice. They wanted to downsize from their current home with a large yard and find a low-maintenance house near their children. Here are some insights for retirement households considering downsizing.

The median price for single-family homes is $474,900, townhomes are $365,000, and condos are around $330,000 for a one-bedroom. There is more than a $100,000 difference between single-family homes and townhomes. Considering condos can further increase the funds available through downsizing.

Summer cooling costs are particularly important in Raleigh. Under Duke Energy Progress, the rate is about 15.54 cents per kilowatt-hour, with typical monthly electric bills ranging from $145 to $160, which can rise to between $170 and $200 during the peak months of July and August. Some households have reported summer bills exceeding $400. Starting in 2027, rates are expected to increase further, projected to rise from $163.84 to $186.95 per month for 1,000 kilowatt-hours. Single-family homes tend to have higher cooling costs than condos due to their larger size and higher ceilings.

Property taxes are calculated by adding the rates for Wake County and the City of Raleigh. For the 2025-2026 period, Wake County's rate is $0.5171 per $100, and Raleigh's is $0.3550 per $100, totaling about 0.87%. For a $470,000 home, this amounts to approximately $4,100 annually.

If you are over 65 and have a household income of $38,800 or less, you can apply for the Elderly or Disabled Homestead Exclusion. This program allows for an exemption of either $25,000 or half of the assessed value, whichever is greater. Even if your income is slightly higher, there is also a Circuit Breaker program that allows you to defer property taxes that exceed 4% to 5% of your income. However, it is important to note that deferred taxes must eventually be settled when the home is sold or inherited.

Moving to a townhome or condo incurs separate HOA fees, but these often include lawn care and exterior maintenance, reducing the physical work required. However, if the community lacks reserves for major repairs like roof replacements, special assessments may arise, so it's wise to check the community's financial reports before signing a contract. If you are moving closer to your children, it may be more practical to choose a neighborhood based on access to hospitals, public transportation, and the distance to your children's home rather than school districts. Raleigh, being part of the Research Triangle area, has several large hospitals, making it worth considering for families that require regular medical visits after retirement.

Insurance rates are also worth comparing. Single-family homes often have higher homeowners insurance premiums due to larger roofs and yard areas, while condos and townhomes have their building exterior insurance covered by the HOA, included in the management fees. Within Raleigh, areas like Cary or Wake Forest may have different townhome listings and price ranges, so it's advisable to narrow down your living area based on the distance to your children's home. Raleigh has a relatively short and mild winter, so heating costs are not a significant burden. However, the long, humid summers mean that the period for running air conditioning is longer than in other regions, which is reflected in the annual electric bills. When viewing properties, it's practical to budget based on summer bills rather than winter ones.

Ultimately, the couple decided on a townhome located a 15-minute drive from their children's home. Although management fees increased compared to a single-family home, when factoring in cooling costs and property taxes, their overall expenses did not differ significantly. Tax rates and exemptions can vary by county, so it's advisable to double-check with the Wake County Tax Office or a professional before finalizing any contracts. This article does not constitute investment or legal advice.