Home is Home

For decades American families have defined progress as a bigger home. Home builders accommodated this desire for more space and more bedrooms by acquiring land outside of major metropolitan areas and erecting suburbia. Homes went from 1500 sq. ft., to 1800, to 2100 and finally the average size of single-family homes completed in the United States peaked at 2,521 square feet in 2007. That's a big house relative to houses built 30 years ago. Along with more square footage came additional bedrooms and bathrooms. The proportion of single-family homes with three bedrooms increased from 49% to 53% between 2005 and 2009 according to National Association of Home Builders Chief Economist David Crowe.

These additional bedrooms didn't necessarily accommodate more children, instead they often became home offices. The justification, of course, being that the internet and other advances in technology allow more professionals to work from home. Eventually, home offices became a standard selling point whether the prospective homebuyer worked from home or not. New homeowners demanded islands in their appliance filled kitchens even when nobody in the family really enjoyed cooking. Instead, these islands became staging areas for Chinese takeout as individual family members gobbled down their food standing up.

The housing crisis halted this trend towards ever increasing home size in two ways. First, first time homebuyers are being held to much stricter underwriting standards. In other words, they are being limited to buying only what they can actually afford. Second, homebuyers looking to trade up to a bigger home have a lot less equity to work with. They are no longer in a position to come in with huge down payments to bring the mortgage payments down to a more affordable level.

These two factors combined to compel prospective homebuyers to revisit what really matters in a home. How many bedrooms are really necessary for a comfortable lifestyle? How big does a kitchen need to be to prepare a meal for the average American family?

At least for now, it seems that we should regard ourselves as among the fortunate if we can simply afford the house we are currently in, regardless of the size.