When the real estate market imploded and ushered in the Great Recession, one of the biggest casualties was the size of our homes. For years, we’d been building increasingly large homes because, well, we could — and because we assumed all those two-story foyers and master suites could only go up in value. The recession put a screeching halt to this trend: After peaking at 2,521 square feet in 2007, the average size of a new home has dropped, a trend many industry observers thought would continue.
But recent data shows that we’re returning to our pre-recession mentality: New home sizes are going up. It looks like we’re thinking big again.
Census data shows that the average size of a new home built last year was 2,480 square feet, the first increase after three years of successive declines. Nearly 40% of new homes built last year had four or more bedrooms, a return to the all-time high reached in 2005 and 2006. And nearly 20% have three-car garages, an increase following two years of declines.
According to a new survey conducted by real estate website Trulia.com, 27% of Americans said their ideal home size is more than 2,600 square feet, an increase of 10 percentage points in just a year. The number of people who said their ideal house is 3,200 square feet or more also shot up, from 6% in 2011 to 11% this year. By contrast, about a third of respondents said their ideal home was less than 2,200 square feet in 2010.
This reversal is unexpected. In a 2010 report, the National Association of Home Builders speculated that the trend of smaller homes might be due to a secular shift and that our preference for small houses would continue after the recession ended. “Part can also be attributed to trends in factors like the desire to keep energy costs down, amounts of equity in existing homes available to roll into a new one, tightening credit standards, less emphasis on the pure investment motive for buying a home, and an increased share of homes sold to first-time buyers,” the report says. “Not all of these trends are likely to reverse themselves immediately at the end of a recession.”
It seems that this prediction — although it sounds logical — can’t compete with our seemingly insatiable appetite for square footage.