Though the average size of new homes keeps getting bigger, there is more to this home buying trend than meets the eye, according to Census Bureau data presented by the National Association of Home Builders (NAHB) during the International Builders’ Show, which took place February 4-6 in Las Vegas.
“The average home size has continued to rise for the past four years, from 2,362 square feet in 2009 to 2,679 square feet in 2013,” said Rose Quint, NAHB assistant vice president for survey research.
The share of new homes with at least four bedrooms has also been on an upward trend, rising from 34% in 2009 to 48% last year. Meanwhile, the percent of homes with at least three full bathrooms has gone from 23% in 2010 to 35% in 2013, and the share of homes with three or more garages has climbed from 16% in 2010 to 22% last year. The upward trend also applies to the percentage of two-story single-family homes started, with the share steadily rising from 51% in 2009 to 60% in 2013.
As homes get bigger, so does the average sales price, increasing from $248,000 in 2009 to $318,000 in 2013. To find out why homes are getting so big, you need to look at who is buying them.
“It requires a high credit score and a nice income to qualify for a mortgage,” said Quint, who noted that the spread between the average Experian credit score of all U.S. consumers and the average home borrower’s score has risen from 33 points in the early 2000s to 58 points in 2013.
The median income of new-home buyers has steadily climbed from $91,768 in 2005 to $107,607 in 2011. During the same period, the number of new-home sales has dramatically declined, from 1.28 million to 306,000.
“There are not as many people who have the income that can qualify for a new home,” said Quint.
This year, the features that builders are most likely to include in a typical single-family home include a walk-in closet in the master bedroom, low-e windows, a laundry room and a great room, according to the latest survey by NAHB. Energy efficiency is also a key theme, as Energy Star-rated appliances and windows, and programmable thermostats also rank high on the list.
For more information, visit www.nahb.org.