Key insights
- The article suggests that retirees are not downsizing their homes as much as financial planning models assume. This implies continued demand for larger homes and less housing supply coming onto the market than anticipated. This could support home prices and related sectors, but also suggests retirees may have less cash available for other investments or spending, potentially offsetting positive impacts.
%3Amax_bytes(150000)%3Astrip_icc()%2FGettyImages-2228703632-66e7b516673e4feeb7754b2e4e610f8c.jpg&w=3840&q=75)
Get personalized, AI-powered answers built on 27+ years of trusted expertise.
Aging Americans often say they're getting ready to downsize. The data suggests otherwise.
That's a major takeaway from a National Association of Realtors' (NAR) report out last week. The typical boomer ages 61 to 70 who sold a 2,000-square-foot home bought another the same size from June 2024 to June 2025. Those ages 71 to 79 did trim a bit—about 100 square feet, less than the size of a compact parking space. Retirement-age buyers often "mention the intention of downsizing," said Jessica Lautz, the NAR's vice president of research. But there isn't much change in housing sizes as people age.
If part of your retirement math relies on gaining cash and saving on monthly bills by downsizing, that assumption should be checked against what older adults actually do. For many, the costs and stress of a late-life move outweigh the potential savings.
Retirement calculators and financial-planning rules of thumb often assume that older adults will move out of a larger home in their 60s and 70s. The proceeds and lower upkeep can then help fund their retirement.
Many older adults say that's what they plan to do. Freddie Mac's December 2024 Silver Tsunami survey found that two-thirds of boomer homeowners with plans to move said they would be downsizing. Among those who moved in the previous decade, 36% said they had.
But the NAR's figures show similar sizes for the homes older Americans are selling and buying. Federal data points in the same direction.
An Investopedia analysis of U.S. Census data compared housing for Americans ages 55 to 64 in 2014 with that of those ages 65 to 74 a decade later—the window when boomers would be expected to downsize. The median number of rooms per home stayed at six from 2014 to 2024, as did the median number of bedrooms, three. The cohort's homeownership rate rose from 75% to 79%.
Earlier generations didn't downsize much either, Lautz said.
Indeed, a decade ago, Merrill Lynch and AgeWave surveyed retirees who had recently moved and found that almost a third had upsized into a larger home, most often to have room for visiting family. They called it "the downsize surprise."
What's different, though, is what boomers can now bring to their home purchases.
"In recent years, as baby boomers have accumulated significant housing equity, they are able to make housing trades with large down payments or even all-cash purchases," Lautz said. According to the NAR, 39% of those ages 61 to 70 and 46% of those 71 and older paid in cash for their last home, versus 26% of all buyers.
Caveats are in order. Both the NAR and the Investopedia review look only at homeowners. These datasets might miss other ways Americans get out of their larger homes—moving to a rental, a "mother-in-law" suite, assisted living, or even a never-ending set of cruises.
Lautz said some sellers do rent or move in with family, and multigenerational moves "have become increasingly popular."
Still, the NAR found that among buyers and sellers ages 61 to 100, life events (such as marriage, retirement, or children leaving home) and a household member's health were more common reasons to move than wanting to downsize. Among buyers ages 61 to 70, only 11% said the primary reason was for a smaller home. Among those 81 to 100, the share rose only to 18%.
So why do older Americans move? For those ages 71 to 79 who sold their home, "moving closer to family or friends" was the top reason, 41%; for sellers 80 to 100, it was 43%.
A Redfin report earlier this month suggested supply might be keeping many in bigger homes: "In some parts of the country, there aren’t enough small, reasonably priced homes for older Americans to downsize into," the report concluded.
But many older adults say they still want the space.
"Realtors frequently cite working with baby boomer clients who pivot to buy the same size or even larger homes," Lautz said. The motivation, she added, is often to "accommodate families at holidays" or simply not to "part with their belongings."
Get personalized, AI-powered answers built on 27+ years of trusted expertise.