Smaller home sizes usher in more affordable housing

Newly built homes shrink in size

The shrinking size of newly built, single-family homes in in the U.S. could be the beginning of a shift toward more affordable houses, an article in The Wall Street Journal said.

Commerce Department data released Wednesday shows the median size of a single-family home built in the third quarter was 2,414 square feet, down 2.3% from the second quarter measure of 2,472.

The article noted that this is the lowest level lowest since 2012’s fourth quarter, and it is the second consecutive quarterly decline following a 0.2% drop in this year’s second quarter.

Median new-home sizes had been on a general upward swing since 2012 as builders focused on building increasingly larger, more expensive homes to cater to the better-heeled buyers with the income and credit to buy homes. Entry-level buyers, meanwhile, remained largely sidelined by tepid wage growth, mounting student debt and stringent mortgage-qualification standards.

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