Thursday, January 20, 2011

New Jersey Builders Plan for Trend to Smaller Houses

Buyers want smaller houses, and builders nationwide are listening.  “Most builders will build smaller and lower-priced homes in 2011,” said Rose Quint, a researcher with the National Association of Home Builders (NAHB). “Our experts expect the average home size in 2015 to be around 2,150 sq ft.”  That’s down from the 2,377 SF average size of single-family homes in the US in 2010, and significantly below the 2,500+ SF average size at the top of the market in 2007.  Home sizes are, on average, almost 50% above what builders offered in the 1970s.

NAHB surveyed builders across the country, and 60% said they are planning to cut the sizes of the houses they will build in the next few years.  This only makes sense if that is what buyers want, and it is a combination of the economy and changing lifestyles.  To accommodate the smaller footprint, builders are replacing formal living and dining rooms with multipurpose areas, or "great rooms."  More than 80% of the builders responded that they expect the formal living room to vanish, as will houses with 3+ baths and 4+ bedrooms.

"There are factors behind the decline that are longer-term and will stay with us,” Quint said. "Costs savings and demographics are also shrinking houses.  There is an overwhelming desire in the population to keep energy costs down.  20% of our population will be over 65 in a few decades. They don’t want a big home,” added Quint.

Green features are growing strongly in popularity, with both builders and buyers.  More than 80% of buyers list energy-efficient heating, air-conditioning and appliances as “must-haves” in their new homes.

The recession and drop in home values have also tempered home buyers’ desires. “People don’t have a lot of equity in their homes to roll into a bigger home. Those times are over,” Quint said. “People have come to realize, ‘Let’s buy what we need, not what we don’t need.’”

To find New Jersey builders who are offering products you want and that fit your lifestyle, call or email me.  Not all new home developments in Mercer County and surrounding areas are the same, and not all builders are as "green" as others.  Let me know what you're looking for.

Joe Giancarli, SA
Real Estate Advisor

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