A new trend has hit residential properties as far as space consumption goes -- they are bigger than traditional homes as owners want more rooms. Naturally, the price tags go up with the size.
According to Realtor Mag, new homes have increased their sizes to an average of 2,720 square feet last year. This is a big bump compared to 2014 when the average home size reached only 2,660 square feet, as reported by the National Association of Home Builders. Almost half of the residential properties constructed last year had four or more bedrooms. The garage also got more room which allows it to hold three or more vehicles. Last year, the average price of a new-home reached $351,000. It went up from $100,000 in 2009, according to the reports of NAHB.
The increase in home prices is said to be caused by a high demand for luxury homes rather than homes for first-time homebuyers. Builders say they veer away from building units for first-time homeowners because of high costs to purchase land and to construct the properties. Adding to the challenge is the lack of available mortgage for less well-off buyers. First-time homebuyers prefer to purchase average size homes since they want to live in a smaller house and at the same time they don't like to struggle in payments plus it takes time to save enough money for down payment.
In 2008, the average new-home size was 2,360 square feet when the financial crisis struck. The size of space preferred by buyers rapidly increased in 2014 and the trend continued last year.
Meanwhile, in the report by The Wall Street Journal, the NAHB cited that the share of first-time homebuyers of U.S. homes dropped down to 32 percent last 2015 from 33 percent in 2014. The NAHB report added that this is the lowest level it has reached in three decades. Furthermore, in the International Builders' Show, a major topic of conversation was how to convince younger homebuyers to start buying homes and for boomers to begin shopping for homes again.