Builders: Buyers want smaller homes, but paying more

Though many consumers appear to desire moving into smaller homes, builders say some are paying more for the opportunity to do so.

Buyers are handing over more cash per square foot when building smaller new homes, primarily because they're also asking for energy-efficient upgrades - which can cost more upfront - and also paying for higher-end finishings, reported AOL Real Estate. Builders told the news site that more buyers find themselves wanting to trade more space for cost efficiency and a more comfortable lifestyle.

"Building right now is a little more cost-effective than it was in the boom," David Werschay, CEO of Werschay Homes, told the site. "Customers say, 'I want the house to function for my lifestyle, I don't need the space.'" He gave an example in which two spouses would each need a workspace. In the past, builders would simply construct two home offices, but today's buyers are willing to accept more creative designs that would allow both spouses to share the same workspace, he said.

The report also cited data from a National Association of Home Builders survey which showed that 95 percent of builders are constructing smaller homes at the request of buyers, also noting that the average square footage for new homes has dropped over the past three years.

Other studies have found similar results. A recent survey by Relocation.com showed that 48 percent of homebuyers would prefer moving into a home between 1,000 and 1,999 square feet. Fewer than 30 percent desired homes between 2,000 and 2,999 square feet.
 

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