Builders join the smaller-house trend
Jamie Smith Hopkins writes in today's Sun about downsizing moves by home owners -- and not just retirees and empty nesters. Home builders are joining the small-house trend, too. They've figured out that Americans can afford less house and often want smaller even if they can afford bigger. At the same time, builders need a product to compete 
with all the foreclosed houses that still flood the market and keep falling in price.
Compact starter homes are a way to do that. KB Home introduced its Open Series of homes this year, which it says have been selling nicely. Open Series designs range from 1,239 to 2,300 square feet, according to Builder online, and are priced less than $120,000 in Las Vegas and less than $300,000 in California. To save space without making people feel cramped they combine the kitchen, dining and living spaces in one, wall-less area. (Here's a video.) Two months ago KB said it was relaunching operations in Maryland, and it looks like it'll push the Open Series hard here. D.R. Horton and other builders are also offering smaller homes, says Seeking Alpha.
All in all, a good trend. Smaller houses, smaller energy bills, smaller mortgages. It will, however, mean much lower profits for builders. (Full disclosure: Your blogger & Mrs. Hancock, new empty nesters, live in a house of 2,300 square feet, according to the State Department of Assessments & Taxation. Seems too big.)
Comments
What's wrong with a smaller, say 2200-2400 sq ft home? The 3500-4000 sq ft mansions out there in foreclosure may sit forever.
Makes sense to me...lower mortgage, heat, A/C expenses...not to mention lower taxes.
Home builders profits? How much are they making with all the unsold/unwanted mansion?
Posted by: Vern | November 19, 2009 8:17 AM
How much of the smaller home trend is because of what the owners can afford? I'd like to think at least some of it is because people are concerned about energy efficiency, the environment, etc., as well as worried about what they really can afford.
Posted by: Justine | November 19, 2009 9:24 AM
The smallest of the KB offering described above (1239sf) is still quite large in the actual 'small home" movement which average about 700sf are rarely above 1000.
nd development costs, utilities,
Posted by: MrRational | November 19, 2009 11:33 AM
And don't forget to mention less cleaning. Finally the builders got it.
Posted by: Jelena | November 19, 2009 1:38 PM
Jelena, you're a poster after my mum's heart. She's mentioned that for years, and was so happy to move into a smaller home when my brother graduated from HS.
Justine, I will say that for some of us in the market, all of what you mentioned factor into the equation of house hunting for smaller-sized homes. Price is a factor, but I'm a pseudo-Luddite/hick that would love to have a clothesline in the backyard for discreet air-drying of garments. Many smaller houses are in established neighborhoods that are sans neighborhood/home owner agreements restricting anything that would add actual character or variety to a neighborhood (or tackiness, for those who want to paint their houses blaze orange), or potentially bar other energy-efficiency attempts on the part of a homeowner. I don't need 2000 square feet to raise a family well, nor do I need the larger space just so I can furnish more rooms.
Posted by: Laura | November 19, 2009 3:50 PM