Are 40's & 50's Bungalows the Next "Big" Thing?

Avondale, Rotherwood, Park Circle and similar neighborhoods are gaining appeal as the pendulum swings back from the ever bigger construction quest of the last few decades.

"Despite rising energy prices and smaller households, homes keep getting bigger, according to government data. It seems big homes are still a key symbol of prosperity, a sign for many people that they’ve achieved the American dream.

Here’s a look at the expansion of homes over the past several decades:

• More square footage. In 2005, the average floor area in a newly built home reached an all-time high of 2,434 square feet, up from an average 2,349 square feet in 2004 and just 1,645 square feet in 1975.
• Homes get taller. In 1973, two-thirds of new homes were one-story. By the 1980s, home sizes had risen nearly 25 percent, despite the high energy costs of running a larger home. In 2006, the majority of homes were two-story to accommodate larger floor plans on smaller lot sizes.
• Sprawl takes hold. Home buyers took advantage of soft energy prices throughout the late 1980s and the 1990s by building bigger, higher volume homes. At the same time, neighborhoods sprawled from urban centers to more spacious suburbs and low interest rates put the big homes in reach for a wider swatch of consumers.

There are plenty of signs that massive homes are starting to lose favor to smaller abodes. Here are some factors that likely will contribute to smaller homes in the coming years:

• Small is more affordable. Median home values have jumped about 40 percent to about $167,500 between 1990 and 2005, which means big homes may be getting too expensive for many home buyers.
  
• Baby boomers downsize. Baby boomers, the largest U.S. population segment at 78 million in 2005, began turning 60 in 2006. As they become empty nesters, many opt to downsize from their family homes into smaller houses or condos that are easier to maintain.
  
• Construction, upkeep gets pricey. The cost of land and materials is growing, as are the costs to heat and cool a home. These economic factors may cause many home buyers to think twice about buying a home larger than what they really need.
  
• Surrender the commute. Rising gas prices and growing traffic problems from suburbs — where the majority of larger homes are being built — may cause some home buyers to rethink the tradeoff between owning a big house and a long commute."

For the full Realtor Magazine article: http://www.realtor.org/rmomag.NSF/pages/BlancheEvans200706?OpenDocument

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