Residential construction overall may have stalled out after a brisk 2013, but what is being built shows Americans haven’t lost their desire for a little more elbow room in their homesteads.
According to just released data from the U.S. Census Bureau, both the median and average size of a new single-family home built in 2013 hit new all time highs of 2,384 and 2,598 square feet, respectively.
Construction spending has stalled this spring, but during the first four months of this year, construction spending amounted to $274.5 billion, 8.9% above the same period in 2013 – much of that activity centered on this segment of the market.
According to the Census, the average sales price of new single-family homes sold was $324,500, compared with the average price of $292,200 in 2012. The average price per square foot for new single-family homes sold was $93.70.
Interestingly enough, the trend of preferring to build bigger homes was reported last week. Dallas homebuilders said they wouldn't build a home that sells for $250,000 for fear it won't sell.
The average new single-family home sold was built on a lot of 15,456 square feet.
There were 91,000 contractor-built single-family homes started in 2013.
The average contract price was $298,000.
The one segment of new home sales which appears to be flourishing is larger, more luxurious homes, which cater to the upper income set.
Sales of the priciest 1% of homes are up 21.1% so far this year, according to Redfin. This follows a gain of 35.7% in 2013. Meanwhile, on the other side of the bridge, home sales in the remaining 99% of the market have fallen 7.6% in 2014.
Meanwhile, there are bigger homes, but fewer new households being formed.
According to Census Bureau data, in the first quarter the number of households formed each month was 189,000, which is down from 1,563,000 in 2013, dropping more or less steadily.
Meanwhile, builders are being slowed by the lack of developed lots. In fact, families buying new homes can expect prices to continue to rise, as builders say there’s a low supply of developed lots.
“Builders price homes based on what they are going to have to pay for all the ingredients. If they are starting to pay more for lots, they are going to have to pass that on right away,” said David Crowe, chief economist at the National Association of Home Builders.
Among home builders, 59% reported last month that there is a “low” or “very low” supply of developed lots in their market areas.
Highlights of the Census Bureau’s survey of new homes built in 2013 include the following.
Of the 569,000 single-family homes completed in 2013:
- 518,000 had air-conditioning.
- 59,000 had two or fewer bedrooms and 251,000 had four bedrooms or more.
- 27,000 had one and one-half bathrooms or less, whereas 188,000 homes had three or more bathrooms.
- 166,000 had a full or partial basement, while 91,000 had a crawl space, and 312,000 had a slab or other type of foundation.
- 305,000 had two or more stories.
- 333,000 had a forced-air furnace and 216,000 had a heat pump as the primary heating system.
- 347,000 had a heating system powered by gas and 214,000 had a heating system powered by electricity.
The average single-family house completed was 2,598 square feet.
Of the 307,000 multifamily units started in 2013, 23,000 were age-restricted.
Of the 195,000 multifamily units completed in 2013:
- 14,000 were age-restricted.
- 129,000 were heated with electricity and 64,000 were heated with gas.
- 91,000 had two or more bathrooms.
- 79,000 had one bedroom and 27,000 had three or more bedrooms.
The average square footage of multifamily units built for rent was 1,082.
Of the 10,000 multifamily buildings completed in 2013:
- 5,000 had one or two floors.
- 6,000 used electricity as the primary heating fuel.
Of the 429,000 single-family homes sold in 2013:
- 120,000 used vinyl siding as the principle type of exterior wall material, while only 12,000 used wood.
- 300,000 had 2-car garages, whereas 98,000 had garages for three cars or more.
- 207,000 had one fireplace and 20,000 had two or more fireplaces.