Once you retire and the kids leave the nest, you may decide to downsize to a smaller home. It may be to cut down on costs, or perhaps you just don't need all the extra space for just you or you and your spouse.

But would you ever consider moving into a house that's less than 500 square feet?

Small suburban house

Image source: Getty Images.

"Granny pods" are a relatively recent development in the world of retirement housing, and they're essentially tiny houses that are developed and built with seniors in mind. Like a typical tiny house, they're very small -- usually around 400 square feet. But unlike the typical tiny house, granny pods have special features that make them more suitable for older adults.

Although each pod is different and has varying features, many have extrawide doorways that can easily accommodate a wheelchair or scooter, handrails in the bathrooms to help with balance, and walk-in showers to prevent trip hazards. Most are set up in the style of a studio apartment, with one large living room that doubles as a bedroom, with a small bathroom and kitchen as well.

The most appealing part to many people is the price. Pricing varies widely based on the size of the home and the features you want, but the homes typically range from around $85,000 (for the smaller, basic houses) to up to $250,000 (for the larger, more luxurious homes). MEDCottage, one of the original granny pod manufacturers, also sells plans starting at $29 if you prefer to build your own and customize as you go.

Advantages of a granny pod

Granny pods are great for people who want to spend most of their free time outside their home, whether that means traveling, spending time with family, or going on new adventures each day. Living in a smaller, less expensive home means you're not wasting money maintaining a house you rarely spend time in.

They're also great for people who want to live near family -- either out of choice or necessity. About 43 million people in the U.S. are helping care for aging parents, and the average cost of living in a nursing home is over $50,000 per year, according to AARP. And while many older adults prefer to live with a family member as they age and need more help performing everyday tasks, that's not always an option.

Because these pods are so small, though, it's possible to build the homes in a family member's backyard. This solution benefits both parties because the retiree still gets to live on their own and retain their independence, while the family members can still check in frequently without having to drive anywhere.

The downsides of a granny pod

Granny pods are not without their challenges as well. For one, if your goal is to build a home to live near family, you'll have to make sure they have a big enough backyard to accommodate the new home.

Even if the lot is spacious enough, there are also zoning laws to adhere to, and it could be illegal to have a guest house or other residence on the property. It may also be considered an eyesore by the neighbors, so that's something to think about before deciding on a granny pod.

Whether this option is a good fit for you will also depend on your personality and individual preferences. Some people may be happy to have their own space where they can live independently, while others may start to feel isolated or that they're stuck living in a closet. These homes may also not be a good fit for anyone who needs around-the-clock care, because although family may be nearby to help, that may not be enough for someone who needs constant supervision.

Housing can be a complicated and emotional issue for retirees, with many people wanting to live in a home for as long as possible to avoid nursing homes or assisted-living facilities. Granny pods aim to solve that problem, allowing retirees to downsize to a home they'll want to live in for the rest of their lives.

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