The Housing Chronicles Blog: The future of new homes is smaller

Friday, October 17, 2008

The future of new homes is smaller

Good-bye McMansions in the suburbs -- the new homes of the future are likely be smaller, denser and built closer to jobs (finally!). Some builders have already started downsizing the plans they offer, while others will be slower to adapt because their entire business model (i.e., Toll Bros.) is predicated on luxury, move-up housing. From an AP story via MSNBC:

When the U.S. housing market hit the skids, homebuilders like KB Home that thrived by offering large homes and expensive amenities began to rethink their home designs with an eye toward making smaller, less costly homes.

Three years into the downturn, that trend appears to be intensifying, as many builders scramble to make their wares palatable and affordable to first-time buyers and compete with a trove of preowned homes and deeply discounted foreclosed homes on the market...

The trend in smaller homes is a reversal of more than two decades of expanding floorplans, during which median size single-family went from less than 1,600 square feet to more than 2,200 square feet.

That steady drive by builders to erect increasingly bigger homes peaked during the housing boom. Derided by some as McMansions, these super-sized homes packed with amenities helped drive up home prices even more...

Click here for full story.

2 comments:

Troy Patterson said...

With people starting to borrow within sensible limits, the extra cost of heating and furnishing a large house, and the cost of getting out to the suburbs, it makes sense that McMansions will become less desireable.

Andy said...

This is a sensible trend. Why should 3 to 4 people live in a 6 bedroom McManison when they have $12,000+ in credit card debt. The push to buy the biggest and best house in the neighborhood led people to massive over leverage which fueled by the financial system led us to our current plight.