What would you do in my parents situation?

[Dren Aguado]

So my parents are in a very nice 2003 construction 2 story SFH 4bd3bth. They're in a 30 yr $180k 2.75% interest conventional mortgage and are paying about $1400/month. They would like a smaller one floor house so their AC/Heater bill is less and no more walking up stairs. They originally got the house for $275k in 2003 and say that its probably worth around $340k now.

I'm just wondering what you guys would do in their situation to maximize their needs and money.