By STEVE BROWN
Real Estate Editor email@example.com
ORLANDO, Fla. — The big run-up in home size may be over.
After years of building steadily bigger and bigger homes, builders and buyers settled for less space in 2016. And the average home size may be headed down a bit more in 2017, industry researchers say.
“The average size of new homes in 2016 declined after increasing in six years in a row,” said Rose Quint, a top researcher for the National Association of Home Builders. “It’s the first time we’ve seen a decrease in this number since 2009.”
But the average size of a U.S. home didn’t fall much. Square footage went from 2,689 in 2015 to 2,634 last year. That amounts to losing the equivalent of a kitchen pantry.
But just the idea that this country’s love affair with the big house may be losing some of its ardor has researchers worked up.
Last year “marked the end of an era when the homes got bigger and bigger year after year and more loaded with amenities,” Quint said at the industry’s annual expo this week in Florida. “Looking forward, I expect the size of new homes to decline as builders get ready for increasing demand from first-time and younger buyers.”
Builders say they are trying to produce more affordable and smaller houses to meet the demands of millennials and first-time buyers.
Regardless of the national numbers, in North Texas we still like our houses super-sized.
The average home that DFW builders offered in the fourth quarter of 2016 was a whopping 3,022 square feet and cost $394,833, according to data from Residential Strategies Inc.
That’s up sharply from five years ago, when the average house built in the area had 2,841 square feet and had a base price of $257,516.
“I think the comparison to 2011 shows how low mortgage rates have allowed DFW buyers to buy a lot more house than they used to,” said Ted Wilson, principal at Residential Strategies. “Interestingly, several builders have shared with me that they are adding now more smaller-square-footage plans to their offering lineup in anticipation of buyer push-back from the affordability issues.
“Much of what has been out there was tilted to the larger square footages.”
Across the country, builders are putting the bite on extra bedrooms, more baths and larger garages to bring down the size of new homes, research shows.
“The share of homes with four bedrooms is down,” Quint said, along with the percentage of new houses with three or more bathrooms. “It came down to 36 percent — the first time we’ve seen a decline since 2009.”
New homebuyers are willing to give up extra room if they can keep lots of goodies in that smaller space, she said.
“A majority — at least two-thirds of buyers across the board — would rather take the smaller house with more products and amenities than a big house with fewer amenities,” Quint said.
And what are the must-have features you’ll find in most new houses in 2017?
“The three most likely items that will be included in new homes this year are walk-in closets in the master bedroom, a laundry room and low-energy-loss windows,” Quint said.
Features most out of favor include media rooms, outdoor fireplaces and laminate countertops.
“Pet-washing stations are also not happening for a lot of people,” Quint said.
The greatest turnoff for homebuyers in 2017 probably won’t be a pet shower or those tacky laminate countertops.
It’s the price tag that turns away most potential new-home buyers.
“The biggest obstacle between them and pulling the trigger is that 55 percent said they can’t find a home they can afford,” Quint said. “This is the single biggest reason keeping them from entering the housing market.”