New House Construction Shifts to Smaller Units
As the economy worsens, the people learn to cope. Lifestyles are changing and are well adapting to these changes in our finances. In the housing industry, more and more are seeing the difficulties, both on the end of the buyers and homeowners, as well as on the end of companies. To cope, new house construction trends are shifting to smaller and more affordable homes. This gives people a higher chance to buy properties. Also, this helps home construction companies bounce back from very difficult financial times.
For instance, in the Terraces Subdivision in Arizona, houses that are newly-constructed have shrunk from 2,000 square feet in are to around 1,700 and even narrower. These houses usually cost $100,000 cheaper than the predecessors, therefore attracting more and more buyers who are rather having a difficult financial situation.
According to Wayne Eide, builder of the Terraces subdivision, people are having more simplicity in terms of how they live their lives. A lot pf people are realizing that they do not need a very big space, or luxury cars and other items. The National Association of Home Builders recently conducted a study and found that 90 percent of all the members are now building smaller houses. Developers enumerate different factors, such as increased awareness about energy and electricity conservation, baby boomers who are now empty-nested and of course, the economic slump.
About 50 percent of all houses are actually foreclosures that are selling at highly affordable prices. Home builders are therefore trying to cope by building smaller houses which would fit the budgets of Americans who are suffering from the economic slump.
Some, however, are saying that the shrinking sizes of new houses are just a mere reaction to the economy. In fact, the sizes of new houses are actually getting back to their normal sizes in the last quarter. However, the whole house construction remains low. This can also be due to the sharp drop that was experienced in the past. Experts say that this would cause very significant changes in the way people think.
In addition to the shrinking sizes of new houses that undergo construction, lending standards also became stricter. This actually decreased the money that is left for the remaining home buyers. Home builders, in reaction, shrank their house sizes in response to this.
