Expand Your Education with These Courses from
Negotiating Skills: Skills for Sales Success: Part Six.
Territory Management: Skills for Sales Success: Part Eight.
ACE: Purchase Reverse Mortgage Course.
Bundle 1: CIPS Core Course (US Version).
Bundle 3: CIPS Institute (Non-US Version).

Why Are New Homes Getting So Big? Look at Who’s Buying Them

Have a comment on this article? Share on Facebook!

new_large_home(1)Preliminary data provided to NAHB by the Census Bureau on the characteristics of homes started in 2013 show the trend toward larger homes continued unabated last year, as did the share of new homes with 4+ bedrooms, 3+ full baths, 2-stories, or 3-car garages. The average size of new homes started in 2013 was 2,679 square feet, about 150 square feet larger than in 2012 and the fourth consecutive annual increase since bottoming out at 2,362 square feet in 2009.

New homes started in 2013 were also more likely to have additional features: nearly half, 48 percent, had 4 or more bedrooms; 35 percent had 3 or more full bathrooms; 22 percent had a garage for at least 3 cars; and 60 percent were 2-stories. The share of new homes started with these features has been increasing consistently for 3 or 4 years, and the most obvious question is “why?” Why are homes getting this BIG?

To get an answer, just take a look at WHO is buying new homes. The typical new home buyer in recent years has been someone with strong credit scores and high levels of income. To the first point, the average credit rating of all U.S. consumers has remained rather flat over the last few years, while the average credit rating of mortgage borrowers took a dramatic jump after 2007. By 2013, the gap between the two measures was 58 points, compared to 33 points in the early 2000s.

To the second point, there has been a rising trend in new home buyers’ income in recent years. In 2005, the median income of new home buyers was $91,768. By 2011, it had increased by more than 17 percent to $107,607. It is not too surprising, therefore, to see home size and features continuing to trend upward, given that those buying new homes are precisely the kind of buyers who generally purchase large, feature-loaded homes.

View this original post on the NAHB blog, Eye on Housing.

Have a comment on this article? Share on Facebook!

Join RISMedia on Twitter and Facebook to connect with us and share your thoughts on this and other topics.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Copyright© 2016 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com

Our Latest News >>