It surprised me when I moved to the US from Canada how many elderly planned to stay in their homes. In Canada it felt like many people downsized to smaller condos, at least in the city.
In California prop 13 freezes property tax assessments at time of purchase, so many elderly people are paying less property tax on their house than they would on a newly bought condo.
Prop 13 will go down as one of the biggest blunders in legislative history IMHO.
I get the complaint that people were being taxed out of their homes and that's not good, but in the end it just shifts the tax burden from the old to the young.
And it's extremely Regressive. Out of 2 people who bought the same house, the guy who bought it 30 years ago, made 2 million dollars, but is taxed 10 times less!
> Prop 13 is outright generational theft from younger people by older generations.
It's actually theft by corporate (or family chain) long-term property owners from everybody else; it doesn't favor individuals of particular ages (especially since the parent-child residence exception was adopted.)
It disfavors people who choose to live somewhere other than a home they (or their parents before them) have lived for a long time, but it disfavors old people who choose to move just as much as young people who do so.
Another factor that is present in some places (at least here in Seattle) is that certain regulations discourage condo construction relative to building rental units. Essentially, there is a stricter inspection process for any units that are to be sold. The law was well-intentioned, but has led to crazy things like 10-20k luxury apartment units being built per year with none of them available for purchase.
To be fair, moving is a pain, you'd be giving up an investment you've held for decades, and you may have settled down into an area and not want to move around. Plus, maybe there just aren't many other options where you live.
I'm not elderly, but that's a few reasons why they wouldn't downsize.
