Downsizing Done Right – Tips for Empty Nesters. Part 1: Lets talk taxes and insurance

These two expenses have been climbing year after year in Minnesota, and they hit single-family homes harder than other property types:

• Property taxes — In many south metro cities, taxes are 1.1–1.3% of assessed value (e.g., a $500,000 home can cost $5,500–$6,500/year). Older homes with reassessments or additions often see even higher increases.
• Homeowners insurance — Premiums have risen sharply due to inflation, weather events, and replacement costs. A typical single-family policy can run $1,500–$3,000/year or more, and it keeps going up.

For empty nesters whose kids are gone and who no longer need 4–5 bedrooms, these ongoing costs feel unnecessary. Downsizing to a townhome, condo, or smaller single-family home often reduces these burdens significantly.

How Townhomes and Condos Save on Taxes and Insurance

• Townhomes: Usually have lower property taxes than single-family homes of similar value (smaller lot, less land assessment). Insurance is typically lower because the structure is smaller and often newer (vinyl siding, updated systems). HOA fees cover exterior maintenance, snow removal, and landscaping—eliminating those personal costs.
• Condos: Taxes are generally lower (shared land/building assessment). The biggest savings: hazard insurance is included in HOA fees, covering the building and exterior. Most owners add a renters insurance policy (~$50–$80/month) for personal belongings and deductible protection. This can save $1,000–$2,000/year compared to a single-family home.

Important note: Condo HOA fees can be higher ($300–$600+/month) if the building has amenities (pool, gym, tennis courts). Older condos (1970s/1980s) may carry additional insurance costs due to age. Newer townhomes (last 20 years) often have lower fees, modern systems (vinyl windows/siding, updated fire prevention), and better long-term value.