The average size of newly built single-family homes was effectively unchanged during the second quarter of 2014. However, current levels reflect recent increases in typical new home size due to an atypical mix of new home buyers.
According to second quarter 2014 data from the Census Quarterly Starts and Completions by Purpose and Design and NAHB analysis, average single-family square floor area decreased from 2,727 to 2,653 square feet, while the median held steady at 2,478 on a quarter-over quarter basis.
On a less volatile one-year moving average, the recent trend of increasing size during the post-recession period appears to have cooled. Nonetheless, current levels remain higher than the pre-recession period. Since cycle lows and on a one-year moving average basis, the average size of new single-family homes has increased 13% to 2,684 square feet, while the median size has increased almost 18% to 2,478 square feet.
As noted in NAHB’s analysis of 2012 Census construction data, the recent rise in single-family home sizes is consistent with the historical pattern coming out of recessions. Home sizes fall into the recession as some homebuyers cut back, and then sizes rise as high-end homebuyers, who face fewer credit constraints, return to the housing market in relatively greater proportions. This pattern has been exacerbated in the last two years due to market weakness among first-time homebuyers.