Downsizing in the Lehigh Valley: How to Sell Your Home and Plan the Move

By Alex Buys Homes·Published Sep 29, 2026·9 min read

When the kids have moved out, the stairs feel steeper or the tax bill keeps climbing, a smaller home can start to make a lot of sense. Downsizing is still a big decision, and selling the house you’ve lived in for decades feels different from any sale you’ve made before.

This guide is for homeowners in Lehigh and Northampton counties who are weighing that move. It covers timing, decluttering, choosing between listing and a cash sale, what each costs, the tax rules that apply and where to get local help, as of September 2026.

When is the right time to downsize?

A few questions make the decision clearer:

• What does staying cost? Add up a year of property taxes, insurance, utilities and the repairs you’ve been putting off.
• Where will you go? A smaller house, an apartment, a 55-plus community or a move closer to family each changes your budget and timing.
• Do you need to sell first? If your next home depends on the money from this one, the sale date drives everything else.
• Where do you stand on taxes? The federal and Pennsylvania home-sale exclusions both depend on how long you’ve owned and lived in the house. Check before you move out, especially if a move to assisted living is part of the plan (details below).

How do you declutter a house you’ve lived in for decades?

Start early, work one room at a time and sort everything into keep, give to family, donate, sell and discard. Measure your next home before deciding which furniture goes with you, and give family members a firm date to claim what they want.

1. Start where it’s easiest. A guest room or hall closet builds momentum before you tackle the attic, basement or garage.
2. Plan around the new floor plan. Knowing where the couch and bed will go makes the keep pile realistic.
3. Set a family deadline. Anything unclaimed by the date goes to donation or sale.
4. Photograph what you can’t keep. Pictures of keepsakes take up no space.
5. Save the house records. The IRS says to keep records that document your home’s adjusted basis, generally until three years after the due date of your tax return for the year you sell (IRS Publication 523). That includes your purchase papers and receipts for improvements.
6. Hold off on big projects. Don’t start renovations until you’ve decided how you’ll sell. Some updates pay off when you list; none are needed for an as-is sale.

Should you list with an agent or sell for cash when downsizing?

Two rows apply no matter how you sell. Pennsylvania requires sellers of homes with one to four units to give the buyer a signed disclosure statement listing known material defects before the agreement of sale is signed (68 Pa.C.S. §§ 7103, 7303). And the 1% state realty transfer tax applies to either sale, with buyer and seller jointly liable (PA realty transfer tax).

Be clear-eyed about price. Our offers start from what the house would be worth after repairs and subtract the costs above, as How It Works explains, so a cash offer is lower than what a fully updated house would bring. If your home is in good condition and you aren’t in a hurry, listing will likely net you more. Our guides on cash buyer vs. listing with an agent, how we calculate your cash offer and how to tell if a cash buyer is legit walk through the comparison.

What does it cost to sell a house in Pennsylvania?

• Getting ready and moving: cleaning, repairs, staging if you list, movers and any storage.
• Selling costs: an agent’s fees are negotiable and must be set out in a written agreement (49 Pa. Code § 35.336). Add title and settlement charges and any credits you give the buyer.
• Transfer tax: 1% to the state, plus local tax where your municipality and school district charge it. Our Pennsylvania realty transfer tax guide explains how it is usually split.
• Holding costs: the mortgage, taxes, insurance and utilities keep running until closing, which can mean paying for two homes at once.

The simplest comparison is your net: the price minus every cost above. Ask any agent or buyer for a written estimate of what you would take home.

Which tax rules help when you downsize in Pennsylvania?

Federal home-sale exclusion

You generally get the full exclusion if, during the five years before the sale, you owned the home and it was your residence for a total of at least 24 months, and you haven’t claimed the exclusion on another home sold in the two years before (IRS Publication 523). Two rules matter to many downsizers:

• Care facilities. If a physical or mental condition leaves you unable to care for yourself, time you spend in a licensed care facility, such as a nursing home, counts toward the residence test, as long as the home was your main residence for at least 12 months of those five years.
• Surviving spouses. If you haven’t remarried, you can count your late spouse’s ownership and residence. You may claim up to $500,000 if you sell within two years of your spouse’s death and meet the other conditions.

Pennsylvania personal income tax

Pennsylvania generally exempts the gain on a principal residence you owned and physically lived in for two of the five years before the sale (PA Personal Income Tax Guide). Its guidance is stricter about care facilities. In the Department of Revenue’s example, a spouse who spent the four years before a sale in an assisted-living facility doesn’t qualify on their share, while a joint return lets the qualifying spouse cover the whole gain (REV-625). A surviving spouse who hasn’t remarried may claim the exclusion if the late spouse met the conditions. Gain that isn’t excluded is taxed at 3.07% (PA tax rates).

Property Tax/Rent Rebate

The program is open to Pennsylvanians 65 and older, widows and widowers 50 and older, and people with disabilities 18 and older, with household income of $48,110 or less. For 2025 rebates, applications are due by December 31, 2026, online through myPATH, by mail or in person (Property Tax/Rent Rebate Program).

Homeowners with income of $32,070 or less who pay property taxes above 15% of their income also get a supplemental rebate, for a total of up to $1,500. If you downsize from owning to renting, you can still apply: renters use a rent certificate from the landlord.

Homestead exclusion on your next home

If you buy a smaller home, apply for your county’s homestead exclusion, which lowers school property taxes through state gaming revenue. Lehigh County says applications must be filed with its assessment office by March 1 (Lehigh County Office of Assessment). In other counties, ask the county assessment office for its form and deadline.

Where can Lehigh Valley seniors get help with a move?

Start with your county’s Area Agency on Aging, which the Pennsylvania Department of Aging calls “the front door for aging services in your community.” Pennsylvania has 52 of these agencies covering all 67 counties (PA Department of Aging).

• Lehigh County Aging and Adult Services
• Northampton County Area Agency on Aging
• The Department of Aging’s directory for other counties

We buy houses throughout the area, including Allentown, Bethlehem, Easton, Emmaus, Whitehall and Nazareth.

What’s a simple step-by-step plan for downsizing?

1. Set your budget and your next address, and decide whether you must sell before you buy.
2. Check your tax position against the two-year rules above, and gather your house records.
3. Get two numbers: an agent’s pricing opinion with estimated costs, and a cash offer. Compare what you’d take home from each.
4. Declutter and book movers once you know your timeline.
5. Pick a closing date that matches your move.
6. After you move, file for the Property Tax/Rent Rebate if you qualify and apply for the homestead exclusion on your new home.

If you’re selling a parent’s home after a death rather than your own, see our guides to selling an inherited house in Pennsylvania and selling a house in probate.