A system and method for reordering storage levels in a virtualized environment includes identifying a virtual machine (VM) to be transitioned and determining a new storage level order for the VM. The new storage level order reduces a VM live state during a transition, and accounts for hierarchical shared storage memory and criteria imposed by an application to reduce recovery operations after dynamic resource allocation actions. The new storage level order recommendation is propagated to VMs. The new storage level order applied in the VMs. A different storage-level order is recommended after the transition.