The number-one rule in real estate is location, location, location, but that means different things to different people. For young families, the most desirable location is typically a neighborhood that’s near good schools and kid-friendly parks and (ideally) isn’t far from work. Retirees have different criteria. Their perfect destination is more likely to offer good health care facilities, be close to family and friends, and have a reasonable cost of living—particularly when it comes to home prices.
That last item is a tall order these days, with home prices up nearly 16% in the first quarter of 2022 compared with a year ago. While rising mortgage rates have slowed sales somewhat, a paltry inventory of homes for sale is likely to keep prices elevated for the foreseeable future.
But again, it’s all about location. In some parts of the country, home prices are well below the national median of $368,200—a nice bonus for seniors who are downsizing from a high-cost part of the country. And moving to a lower-cost area doesn’t mean giving up a great quality of life. Our seven cities offer access to high-quality health care, abundant outdoor activities and lively downtowns. Three are college towns, which means that when you’re not exploring local hiking and biking trails (or skiing, because not everyone hates winter), you’ll have plenty of opportunities to keep your mind sharp, too.
Surveys have shown that the primary reason retirees move is to be closer to family, so we cast a wide net and looked for a city in seven out of the nine U.S. Census divisions. Finding affordable destinations on both coasts was a challenge, but we’ve located attractive cities for retirees who have family in California or New England.
Although our destinations are small or medium-size cities, most provide easy day trips to major metropolitan areas. For example, from Scranton, Pa., where you can find a spacious home for about $150,000, you can get to New York City in less than three hours.
In the past, we’ve tried to limit our selections to cities in states that are rated as tax-friendly or neutral by Kiplinger’s State-by-State Guide to Taxes on Retirees. This year, we included some cities in states with above-average taxes, because taxes are just one factor retirees consider when selecting a place to live. For example, you may be willing to shoulder a higher state tax bill to live closer to adult children and grandchildren. In addition, states across the U.S.—both red and blue—are lowering taxes in response to post-pandemic budget surpluses.
Note that figures for living costs are based on the Council for Community and Economic Research’s Cost of Living Index. The average for all participating places is 100.
What $400,000 will buy: Ranch-style home with three bedrooms, three baths and an expansive backyard
Visalia lies in the heart of California’s Central Valley and sits at the base of the Sequoia and Kings Canyon national parks. Visalia is also at the center of the nation’s most productive agricultural region, which harvests more than 250 different crops.
Downtown Visalia has a number of charms, from farm-to-table sidewalk cafés to the farmers market, which offers locally grown produce and artisan goods every Saturday and Wednesday. Locals also love Visalia’s annual Taste the Arts Festival, which takes place downtown every October and celebrates the artistic culture and agricultural vitality of the community. Traditional festivities include the annual Waiter’s Race, culinary tastings and music by the Sequoia Symphony Orchestra.
Visalia is an ideal spot to explore the natural beauty of California’s Central Valley. You can snowshoe in the winter, fish on Lake Success in the summer and make your way through Crystal Cave in the fall. For $20, you can book a round-trip on the Sequoia Shuttle from Visalia to Sequoia National Park. Visalia is also home to many hiking trails, backcountry horseback riding, and numerous golf courses and tennis courts in and around the region.
Visalia is a manageable drive from many of California’s most populous (and more expensive) cities. It’s 240 miles from San Francisco and 190 miles from Los Angeles.
Home prices are a bargain compared with California’s coastal cities. For about $380,000, you can buy a newly built Mediterranean-style home with three bedrooms, two baths and a two-car garage.
Five hospitals are located within 25 miles of Visalia. Kaweah Health Medical, the largest hospital in Tulare County, has about 580 beds and offers specialties in cardiac care, neurosciences and orthopedics, among others.
California excludes Social Security benefits from state income taxes, but other forms of retirement income are taxable. However, although the Golden State has the highest income tax rate in the country for high earners, tax rates for middle- and lower-income folks are much lower, which reduces the tax hit on your retirement savings. Sales taxes are relatively high, but the median property tax rate is below average for the U.S. EMMA PATCH
What $400,000 will buy: Three-bedroom, two-bath home located 10 minutes from downtown and blocks away from the Riverfront Trail on the Colorado River
Named for the confluence of the Colorado and Gunnison rivers, Grand Junction is a paradise for lovers of the outdoors. The small city in western Colorado is just six miles from the Colorado National Monument—20,000 acres of stunning natural beauty with six canyons, red sandstone cliffs and 14 hiking trails. Grand Mesa, the world’s largest flat-top mountain, is 45 minutes away and includes 500 square miles of national forest and 300 lakes, where you can fish for rainbow trout, camp, hike or just sit and enjoy the scenery.
From downtown Grand Junction you can walk or bike on 24 miles of paved trails along the Colorado River, including an Audubon trail that is home to 200 species of birds. The James M. Robb Colorado River State Park provides easy river access for kayaking and whitewater rafting. Skiing on Colorado’s less-crowded Western Slope is less than an hour away and you can mingle with jet-setters at Aspen and Telluride, about two hours away.
Golfing is almost a year-round activity in sunny Grand Junction, with four public golf courses, including the Golf Club at Redlands Mesa, named the best public golf course in Colorado. The area is also known for its fruit orchards and as the hub of Colorado wine country.
Historic downtown Grand Junction’s pedestrian-friendly Main Street is filled with local farm-to-table restaurants, boutiques, art galleries (open late the first Friday of every month) and one of the nation’s largest outdoor sculpture collections, with more than 100 pieces of art lining the sidewalks. The Avalon Theater, which was built in 1923 and restored in 2014, hosts national and local performances, including the Grand Junction Symphony. The Museum of the West, the Western Colorado Botanical Gardens and Colorado Mesa University offer additional activities.
Grand Junction, just under four hours from Denver (via Interstate 70) and just over four hours to Salt Lake City, is served by Amtrak and the Grand Junction Regional Airport.
Homes in Grand Junction are priced slightly above the U.S. median, but they’re affordable compared with homes in larger Colorado cities, such as Denver (with a median of $662,000) and Boulder ($859,000). There are townhouses and condos available for about $320,000 or less, according to real estate website Zillow.
The city has three hospitals, including the 460-bed St. Mary’s Medical Center, the largest medical center between Denver and Salt Lake City.
Colorado offers generous tax breaks for retirees. Taxpayers age 65 and older can exclude up to $24,000 of income from private, government and military retirement plans, including IRAs ($20,000 for taxpayers 55 to 64 years old). Most Social Security benefits are also excluded from state income taxes. KIMBERLY LANKFORD
What $400,000 will buy: Four-bedroom, four-bath home with a spacious backyard and attached garage
If hearing the word Oklahoma conjures up images of covered wagons, you need to update your frame of reference because Tulsa is a retiree’s overlooked gem on the plains. Those looking to enjoy the outdoors can hike or bike around the Turkey Mountain Urban Wilderness Area, which is less than a 15-minute drive from downtown. The 300-acre area is covered in woods and thick treetops and has two ponds. Turkey Mountain itself provides a scenic view of the Arkansas River, as well as a view of Tulsa from its 300-foot summit.
For those looking to stay cool (or indoors), the Philbrook Museum of Art, a historic home turned into a museum in 1939, has earned the moniker “the most beautiful place in Oklahoma.” Music lovers can stop in Cain’s Ballroom or Tulsa Theater for live shows of country, rap and rock groups or visit the recently opened Bob Dylan Center. History buffs can visit the Greenwood Cultural Center, whose mission is to tell the legacy of Tulsa’s Black Wall Street and the Greenwood district’s revival. And historic Route 66 runs through it.
Housing on the plains is affordable. On the higher-priced end of the market, you can find a four-bedroom, four-bathroom, 3,349-square-foot home that comes with a spacious backyard and attached garage for $379,000, according to Zillow. If you have a lower housing budget, you can find plenty of homes for less than $300,000.
If you’re considering working part-time in retirement, you could try applying for Tulsa Remote, a program launched in 2018 to recruit remote workers to the city. To qualify, you must be self-employed or work remotely full-time outside of Oklahoma and able to move to Tulsa within 12 months of approval. Applicants who are accepted receive $10,000 to cover moving and housing expenses over the course of a year, plus a dedicated coworking space in downtown Tulsa. For more in-formation, go to www.tulsaremote.com.
The Tulsa area has 16 hospitals. Hillcrest Hospital South, with 180 beds, offers a wide range of inpatient and outpatient services, including specialties in cardiac care, orthopedics, stroke and women’s health care.
Oklahoma is a mixed bag for taxes in retirement. The Sooner State doesn’t tax Social Security benefits, and residents can exclude up to $10,000 per person ($20,000 per couple) of other types of retirement income. But Oklahoma has one of the highest combined state and local sales tax rates in the nation, at an average of 8.97%. Property tax rates are about average for the U.S. RIVAN STINSON
What $400,000 will buy: Three-bedroom, three-bath home with a great room and a recently remodeled kitchen
Fort Wayne and Allen County have a lot to offer, including 100 miles of biking, hiking and kayaking trails, meandering rivers, and peaceful forests. Art aficionados can explore Fort Wayne’s Public Art Trail, which ties together more than 150 pieces of art in and around its downtown. Farmers markets, breweries and a recently revitalized downtown also add to Fort Wayne’s draw.
Only a stone’s throw from a handful of major cities, Fort Wayne boasts a prime midwestern location. Chicago and Detroit are about 160 miles away, and the city is 125 miles from Indianapolis. Indiana Dunes National Park, about 115 miles away, hugs 15 miles of the southern shore of Lake Michigan and includes 50 miles of trails.
If you’re 60 or older, you can audit classes at the Fort Wayne campus of Purdue University for free through its Senior Scholars program.
Home prices in Fort Wayne make it an attractive locale as well. Thanks to a median price that’s well below the national average, retirees can buy a spacious home and have plenty left over for other retirement expenses.
Health care facilities are abundant in the Fort Wayne region: There are 14 hospitals within a 25-mile radius. And construction is under way on a new Indiana University Health Medical complex in southwest Fort Wayne; it’s scheduled to be open later this year.
Indiana exempts Social Security benefits from taxes and offers a limited exemption for federal civil-service pensions, but income from IRAs, 401(k) plans and private pensions is fully taxable. Indiana has a flat income tax rate of 3.23%, which will drop to 3.15% for 2023 and 2024. Allen County levies additional income tax at a rate of 1.48%. The state’s sales and property taxes are middle-of-the-road when compared with taxes in other states. Emma Patch
What $400,000 will buy: Three-bedroom, two-bath, recently renovated 1925 house
Winston-Salem is a hub of arts and culture. The medium-size city is home to six colleges, including Wake Forest University, which is consistently ranked among the top 30 colleges in the U.S. and brings many vibrant resources to the area. About 10 years ago, university and city leaders worked together to create the 330-acre Innovation Quarter in downtown Winston-Salem, renovating historic industrial buildings, attracting new businesses and revitalizing the area to be a center for arts, innovation and entertainment.
In the center of Innovation Quarter is Bailey Park, a 1.6-acre public green space, which offers movies and concerts at the outdoor amphitheater and yoga and relaxation on the large grassy lawn that’s surrounded by restaurants, shops and galleries. Nearby is the 1.6-mile Long Branch Trail, which is part of the city’s 25 miles of greenways.
Also downtown is the Stevens Center, a restored 1929 grand theater that hosts performances for the University of North Carolina School of the Arts, the Winston-Salem Symphony, the Piedmont Opera and others. An old mill building downtown was renovated and expanded in 2010 to become the Milton Rhodes Center for the Arts, which has several theaters and performance venues.
Retirees can enjoy exhibits or take classes at the Sawtooth School for Visual Art, a nonprofit community arts school, or take adult music lessons at Salem College’s Community Music School. The colleges in the area host popular music and speaker programs and bring many arts and education opportunities to the community.
Adjacent to the Wake Forest campus is the Reynolda house and gardens, a 134-acre horticultural center that includes a wooded area with walking trails, a native meadow, wetlands and a waterfall. The historic house, formerly owned by tobacco magnate R.J. Reynolds and his family, is now the Reynolda House Museum of American Art, with art and history exhibits.
Seven city parks are within five miles of downtown, including Salem Lake, which has a seven-mile walking and biking loop and is a great spot for fishing and kayaking. Slightly farther away is the 1,100-acre Tanglewood Park, which offers mountain biking, horse stables, two lakes (stocked for fishing), camping and a golf course.
Sports fans can cheer for the Wake Forest Demon Deacons, who play in the competitive NCAA Atlantic Coast Conference (note that prime tickets for basketball and football games may be hard to come by). Charlotte, N.C., is less than 90 minutes away and home to the NFL’s Panthers, the NBA’s Hornets and other professional sports teams.
Seven hospitals are in the area, including the 885-bed Atrium Health Wake Forest Baptist Medical Center, the academic medical center for the well-regarded Wake Forest School of Medicine and the 921-bed Novant Health Forsyth Medical Center.
North Carolina doesn’t tax Social Security benefits, but it does tax most other kinds of retirement income (there are exemptions for some government pensions). Property taxes are low, with breaks for homeowners age 65 and older. KIMBERLY LANKFORD
Courtesy: Lackawanna County Visitors Bureau
What $400,000 will buy: Five-bedroom, five-bath home with a fireplace and two-car garage
If a certain television theme song doesn’t pop into your head at the mention of Scranton, you’ve watched less TV than most. And while you won’t see Michael Scott and other cast members of The Office hanging around, Scranton is a very real place with affordable housing, top-quality health care, easy access to major East Coast cities, and plenty of history and culture to explore.
Scranton was one of the first cities in the U.S. to become electrified, earning it the nickname “Electric City.” In 1886, it became the home of the first electric-only streetcars in the U.S. Retirees can see history up close at the Steamtown National Historic Site, roughly 40 acres of the former Scranton Railroad that features steam loco-motives and freight and passenger cars. Those who are more into pop culture—and sitcoms—can tour the Houdini Museum, which features magic shows and other entertainment, or take a walking tour of set locations from The Office.
If you want to take in a Broadway show or just immerse yourself in the Big Apple, New York City is less than a three-hour drive. For Eagles and Phillies fans, Philadelphia is about two and a half hours away. The Pocono Mountains, which offer golf courses, skiing and other outdoor activities, are less than an hour away.
The cost of living in Scranton is less than the U.S. average, and retirees can buy a lot of space to host the grandkids for the summer. With a $400,000 housing budget, you could buy a five-bedroom, five-bathroom, 3,279-square-foot home, according to Zillow. A five-bedroom, three-bathroom, 2,300-square-foot home was recently on the market for $249,900.
Scranton has 10 hospitals within a 25-mile radius. Geisinger Wyoming Valley Medical Center offers specialties in cancer, cardiac care, orthopedics, women’s health and more.
Pennsylvania doesn’t tax Social Security benefits or other types of retirement income. Property taxes in the Keystone State are on the high end, though homeowners and renters 65 or older and widow(er)s 50 or older may be eligible for property tax or rent rebates. A maximum standard rebate of $650 is generally available, but supplemental rebates can boost the amount to $975 for homeowners with particularly high tax burdens. RIVAN STINSON
What $400,000 will buy: Two-bedroom, two-bath stand-alone condo in the 55+ Founders Ridge development.
Yes, the name is Middletown, but this city on the banks of the Connecticut River is, well, a city—but a small one. And just as New Haven, to the south, has a university at its heart (Yale), so, too, is Middletown enlivened—and educated—by an institution of higher learning: Wesleyan University.
What’s that got to do with choosing Middletown as a retirement destination? Let’s start with the Wesleyan Institute for Lifelong Learning, which offers low-cost classes taught by retired and current faculty and other experts. Participants can study topics such as the 19th-century whaling industry, which was a big part of Connecticut’s economic history. Or, more lightly, the history of humor.
Retirees who’d like to stretch their legs can find a number of walking trails, including a wide range inside the 285-acre Wadsworth Falls State Park, located about three miles from downtown. Yes, there is an actual (modestly sized) waterfall in the park, as well as a classical revival-style estate house that belonged to town bene-factor Clarence S. Wadsworth. You can tour it on Wednesdays—or book it for your child’s wedding.
A short jaunt to neigh-boring Meriden will put you on Amtrak’s Hartford Line, which ties into New Haven to the south and Springfield, Mass., to the north. Hartford, the state capitol, is 17 miles away, and another 15 miles past that is Bradley International Airport. Hartford is home to the Yard Goats, an AA minor league baseball team (the name is a railroad reference).
The median home price in the metro area that includes Middleton is below the national average, but if you buy in town, you’ll pay more. Retirees might have a look at Founders Ridge, a community for residents 55 and older that consists of ranch- and cape-style homes and is currently being built out. For a more traditional option, consider looking across the Connecticut River to neighboring Portland, where you can get a four-bedroom, three-bath contemporary with a roof covered in solar panels for $399,000.
Property taxes are fairly steep, although the state offers property tax credits to homeowners who are at least 65 years old and meet income restrictions. As for other taxes, Connecticut takes a pretty big bite, though the state is gradually eliminating taxes on pensions and annuities for taxpayers with less than $75,000 of federal adjusted gross income (less than $100,000 for joint filers). In addition, starting in 2023, the state will start phasing out taxes on distributions from traditional IRAs for many retirees.DAVID MUhlBAUM
SOURCES: Figures for living costs are based on the Council for Community and Economic Research’s Cost of Living Index. The average for all participating places is 100. Population data comes from the U.S. Census Bureau. Median home sale prices are from the National Association of Realtors’ first quarter report for single-family homes in metropolitan areas or from www.realtor.com. Hospital information is from www.medicare.gov/care-compare.
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