MINT HILL, NC – Tiny homes have presented an interesting topic for many years now, but they always seem a bit out there. They certainly haven’t become normal for most people and most neighborhoods. Could this change? Are tiny homes a potential solution for the housing crisis?
Home size has been a big issue for the American home for many years. The average home size in 1960 was just under 1,300 square feet, while the average home size in 2014 was more than 2,650 square feet. This might seem astounding since the average family was much larger than today and homes were much smaller.
With home sizes on the rise since the 1920s, it’s interesting that tiny homes have recently started to see quite a bit of growth. A big part of the growth has to do with the shrinking family size and affordability. More and more people are getting married later in life and choosing to have fewer children. Couple this with the rising energy prices and the rising home prices, and it’s easy to see why more people might seek a smaller, more affordable home.
What Does This Mean, Exactly?
It’s really hard to pinpoint what the tiny home boom means as it’s not just tiny homes that are becoming more attractive for buyers. The National Association of Home Builders reported in November 2022, that the median size of a new home had dropped to below 2,300 square feet. They expect it to drop even further with the higher interest rates.
Trade shows catering to builders and the real estate industry as a whole have seen more conversations around constraint than in decades past. The soaring interest rates, cost of construction materials, and labor shortages are all contributing to a decline in home building.
Smaller model homes are on display at many trade shows today and even those that would qualify as tiny homes are starting to pop up. The conversations all center around affordability as many believe we are headed toward another recession or depression. With the price of food, gas, and pretty much everything else going up, more buyers are being priced out of the normal real estate market.
Tiny homes, or at least smaller homes, might be one of the solutions builders explore. Unique designs that eliminate hallways, add more windows to let in more light, and use pale interior paint are all on display at the trade shows. All of these options help a smaller space feel and appear larger.
With the vast majority of home builders seeing a demand for smaller homes, the days of a master bedroom that can fit a dresser, bed, two chairs, and even more furniture might be over. More and more buyers are looking for smaller spaces and are willing to cut a bit here and a touch there to help provide the necessary features and keep the home more affordable.
While COVID might have driven people to seek larger homes and the lower interest rates allowed them to qualify, those days are pretty much over. More people are being asked to go back to the office by employers and don’t need the larger home anymore.
Many buyers have stated they are willing to compromise on the size of their new home to be able to afford it today. Some are even willing to accept a more basic interior and fewer outdoor amenities.
It’s unclear exactly what’s going to happen in the near future with the size of homes. While tiny homes might remain on the fringe, smaller homes are becoming more popular.
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