Photo: James Bombales, design by Jaclyn Harper
The early aughts were defined by excess — we slathered on fake tanner, layered our polo shirts and parked gas-guzzling Hummers in the driveways of our McMansions. While the Great Recession put a damper on this excessive consumption, it wasn’t until 2016 that the median size of a single-family home in the US began to shrink, albeit ever so slightly.
Back in 1975, the typical new single-family home floorplan averaged 1,660 square feet, according to data from the United States Census Bureau. New home sizes peaked in 2015 when the median hit 2,740 square feet and have been falling ever since. Zillow predicts this trend will continue into 2020 and beyond, as buyer demographics shift along with housing preferences.
Here we break down the five key reasons behind America’s shrinking new single-family homes.
1. Millennials prefer walkable communities with urban amenities
Photo: James Bombales
Millennials are house hunting in neighborhoods where they can ditch their vehicles for their own two feet. A 2017 survey by the National Association of Realtors® found that 62 percent of Millennials would be willing to give up square footage if it enabled them to walk to urban amenities like stores, restaurants, parks and transit.
2. Today’s buyers can’t afford the McMansions of yesteryear
Photo: James Bombales
Let’s face it, big homes come with big mortgages. As younger buyers struggle to scrape together downpayments and compete for starter homes, those spacious suburban homes built in previous decades become more and more out of reach. McMansions, which typically range from 3,000 to 5,000 square feet, are increasingly sitting on the market due to high prices and differences in generational housing preferences.
3. Sprawling single-family homes are less sustainable
Photo: James Bombales
If you’re looking to reduce your ecological footprint, downsizing your home is a good place to start. Smaller homes require fewer building materials, consume less energy and are often less expensive than their larger counterparts. Millennials value energy-efficient home features more than any other generation and will continue to fuel the demand for modestly sized homes equipped with the latest green technology.
4. Demand is high for accessible, low-maintenance properties
Photo: James Bombales, design by Cynthia Soda
Baby Boomers are entering the 2020s with their own set of housing needs. Older buyers are trading in their spacious homes in the suburbs for smaller, low-maintenance properties with accessibility features — think ground floor master suites, extra-wide doorways and curbless showers. According to the 2019 Zillow Group Consumer Housing Trends Report, 56 percent of new construction home buyers were 40 or older, signaling an uptick in demand for personalized residences that generally require fewer repairs.
5. Trade wars and shortages are pushing prices up
Photo: James Bombales
As homebuyers seek to live closer to urban centers, buildable land is becoming more scarce, and thus, more expensive. To add insult to injury, there’s an ongoing labor shortage in the construction sector and the US-China trade war has upped the prices of building materials like lumber and steel. All of these factors have contributed to higher new single-family home prices, meaning today’s buyers must settle for smaller, more affordable homes than those purchased in previous decades.
