realestate

Homebuyers opt for downsized living spaces

Builders revisit traditional starter home designs to meet modern demand for practical, affordable single-family homes.

A
s household compositions shift, builders are revisiting the starter homes of yesteryear to create more practical and affordable single-family homes for today's buyers. Key statistics show that new home sizes are shrinking: the median size has fallen from 2,320 square feet in 2015 to 2,036 square feet in 2023.

    The trend is expected to continue as demand for smaller houses grows. Some builders are focusing on lush landscaping, community amenities, and a vibrant environment to make small homes feel large. This approach is reminiscent of post-war homes built in the 1950s or even mail-order "kit homes" from the early 20th century.

    Despite the preference for detached single-family homes, some newer developments are skipping amenities like garages and bonus rooms to keep costs down. For example, Lennar's Risinger Court features single-story floor plans as small as 763 square feet, priced at $198,000 – significantly below the median list price in the Fort Worth metro area.

    Other communities, such as Wee-Cottage in Denver and Indigo in Richmond, Texas, take a more holistic approach by focusing on landscape design, shared amenities, walkability, and atmosphere. These developments cater to the growing demand for attainable yet upscale housing, meeting the needs of smaller households and older buyers who want less upkeep.

    The success of these smaller homes is evident: 16 cottages in Indigo's first phase sold out within 45 days, with hundreds more on a waitlist. This trend suggests that smaller homes are not only practical but also highly sought after by today's homebuyers.

Homebuyers choose smaller homes in response to changing lifestyle priorities nationwide.