After years of expansion, the average size of a new home started to come down – but a desire for more space in 3Q 2021 pushed new-home sizes 6.2% higher.
CHICAGO – The pandemic has prompted more Americans to want to supersize their homes.
According to Census Bureau data reported by the National Association of Home Builders (NAHB), the median single-family square floor area increased to 2,337 square feet as of the third quarter, while the average (mean) square footage of new single-family homes rose to 2,541.
The average size of new single-family home is now 6.2% bigger compared to lows reached during the Great Recession.
“Going forward we expect home size to increase again, given a shift in consumer preferences for more space due to the increased use and roles of homes – for work, for study – in the post-COVID-19 environment,” writes Robert Dietz, NAHB’s chief economist, on the association’s Eye on Housing blog.
The desire for more space also impacts existing homes.
According to the Q4 2020 Kitchen & Bath Market Index released by the National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting last spring, existing homeowners are also expanding their spaces and taking on larger remodeling projects to either enlarge or rearrange floor plans.
“We’re seeing an incomparable surge in homeowners looking to rearrange floor plans, tear out complete kitchens, baths and other rooms to make space for increased activity within the home – and generally create a space that better suits their evolving needs,” Bill Darcy, NKBA’s CEO, said in March when releasing the report.
Meanwhile, the supply of starter homes dwindled by more than half over the past five years, according to realtor.com listing data. Realtor.com defines starter homes as ones generally less than 1,850 square feet. Under that definition, only 300,000 starter homes were listed for sale in September.
In addition, the median listing price for a starter home reached $260,000 last month, about 11% higher than a year ago, according to realtor.com, which tracks listing prices rather than selling prices.
Starter homes are now 64% more expensive than they were in 2016 compared with larger homes, which grew 43% in that same period.
Source: “Single-Family Home Size Continues to Trend Higher,” National Association of Home Builders’ Eye on Housing blog (Nov. 22, 2021)
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