Since Housing Slump Houses Are Shrinking

It appears that “The McMansion” sized homes of the housing boom are becoming a thing of the past.

According to a study by Trulia.com, a real estate website, the American median sized home has dropped to 2,100 square feet. This is down from 2,300 square feet during the 2007 housing boom. Builder magazine designs a concept home to reflect the current state of the market each year.  This year, the "Home for the New Economy" is just 1700 square feet.

The scale down trend is a product of necessity.  During the housing boom years, most home expansions were financed through home re-financing deals.  Now that home loans have frozen up, people are less likely to be able to afford to finish their basement for that new game room or home theater they'd been wanting.

Experts say that a broader shift of cultural preferences could also be spurring the shift. Lots and backyards are also getting smaller. Homeowners are now focusing on homes that feature front porches and communal green spaces.  Could this be a sign that Americans are longing for more of a sense of community in their living surroundings?

Many homeowners have found they don't use formal living rooms, sitting rooms, and extra bathrooms so builders are progressively doing away with them and making homes smaller in the process.

Home builders are reporting that the idea of “bigger” is starting to wear off with homeowners, and the homeowners are becoming more realistic in what they want vs. what they need.

The small-is-beautiful shift comes from established baby boomer homeowners as well as from so-called millennia’s who are just coming into their first mortgages. Both demographics are looking for more walk able urban developments.

Developers are paying attention and are now focusing on smaller tight knit communities that support a smaller-scale, less auto-centric approach to urban living. Also, more of the millennial generations are recognizing that they don't want to grow up in the suburbs and want more livable, walk able communities."