The article, Homebuilders say less is more with new homes, from AzCentral.com, reports that when the U.S. housing market hit the skids, homebuilders like KB Home that thrived by offering large homes and expensive amenities began to rethink their home designs with an eye toward making smaller, less costly homes.
Three years into the downturn, that trend appears to be intensifying, as many builders scramble to make their wares palatable and affordable to first-time buyers and compete with a trove of preowned homes and deeply discounted foreclosed homes on the market. The trend in smaller homes is a reversal of more than two decades of expanding floorplans, during which median size single-family went from less than 1,600 square feet to more than 2,200 square feet.
Beyond competing with preowned homes on the market, declining home prices have also made it less profitable to build large homes, said Nishu Sood, a Deutsche Bank analyst. “The only way to respond to the lower price environment ... is to make the home smaller,” Sood said. “As you kind of reduce the floor plan size, we’re getting back to more the way things were historically, kind of undoing the excesses, not just from a price perspective but home size and (fewer amenities).”
Homebuilders say less is more with new homes