Baby Boomers Locked in Big Homes as High Prices, Taxes Deter Downsizing
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Baby Boomers face high capital gains taxes if they sell homes that have appreciated significantly, creating a disincentive to downsize.
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There is a shortage of smaller "missing middle" homes for empty nesters looking to downsize in their same neighborhoods.
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Allowing accessory dwelling units like granny flats provides some options, but not enough.
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The savings from downsizing to a smaller home are negligible compared to costs due to high home prices.
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With low inventory, fewer older homeowners listing homes contributes to ever-higher prices.