We tried to downsize. We retired in early 2015, and went off to Mexico and Europe for six months. We liked it, and didn't kill each other, so we came home, got rid of darn near everything (21 years in that house then), did $30k rehabbing to kitchen and yard as assured by realtor this would make it sell instantly, and listed it in early 2016, heading off to Europe for a second summer. We thought we'd buy something much smaller, maybe a condo, in town, as DW's two sisters still live here.
Not a single offer, not even a lowball, in five months, with reductions from $490 to $460.
We wanted to downsize because (1) it's 3100 sf and the nest was empty; (2) it's on the corner of a busy street that's being extended at the far end, so we expect more noise and traffic; and (3) sometime The Big One will hit SoCal and we'd rather not own real estate here then.
The problem is that there are bad comps. There are even-bigger houses, like 4000 sf, just across the busy street, being offered at $499k and going for less. Those houses even have a HOA with monthly dues of $500, and we have none. Nearby houses at 2100 sf trade quickly, from $399 to $430 or so, but another 1000 sf, the biggest lot in the subdivision, ability to see your kid's elementary school and even hear its bells, along with solar that makes $1800 worth of electricity each year, won't support anything more than about $449k right now, although there are starting to be listings a little higher.
By the way, in another thread I had to caution about the idea that "having solar panels will raise your home's value." $1800 a year, or $150 a month, would pay for about $30,000 of mortgage at current rates.
But we have a 30-year loan at 2.75%, so the monthly payment with taxes and insurance is less than the typical 1200-sf 2-bedroom apartment nearby. So we're staying until something changes. We're back in Europe for the third summer in a row; our son and his spouse and their two big dogs are in the house, as is our little dog.
I'm mostly worried about the possibility of earthquake. Not locally, as we're pretty far from a fault and on cut land, not fill. But if LA (60-90 miles away) gets hit and 10 million people come looking for a place to stay, they'll either have fistfuls of money, or guns. Don't want to find out which.