Dive Brief:
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Americans are super-sizing their homes again, the Commerce Department reported.
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After a few years of downsizing by builders and buyers because of the recession, median home sizes hit a record high of 2,415 square feet in 2014. And more homes sold for more than $400,000 than for less than $200,000 last year—for the first time ever. Another record, according to The Wall Street Journal: 4.8% of homes sold last year went for $750,000 or more.
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One reason: Home sales have tapered off as fewer young adults have formed households and bought their first houses—partly because they have struggled to qualify for mortgages and save for down payments. In response, some builders started chasing more affluent homebuyers, who were more likely to be interested in—and to be able to afford—more spacious, luxury homes.
Dive Insight:
The McMansion’s comeback could be short-lived. Housing industry economists have agreed that millennials will be moving into the market as soon as this year, as banks relax credit requirements and accept smaller down payments.
Plus, The Journal reported, the size of homes under construction started shrinking after the first quarter of last year, a sign that builders are preparing for the promised influx of first-time buyers who will be able to afford only smaller, starter homes.
