Thursday, June 4, 2020 – Size/Price of American Homes

I walk today in the same upscale Farmers Branch neighborhood — Valley View Park Estates — I did yesterday. Have American homes always been so large? This home has five bedrooms, five and one-half baths and 5,171 square feet. It was listed at $1,199,000.

1973 Average Home

Average Home Size in the U.S.

According to HSH, a consumers’ mortgage resource, in 1973, the median new single-family house was just 1,525 square feet, according to the US Census Bureau. By 2010, it had grown to 2,169 square feet. And, by 2018, it had bloated to 2,435 square feet. Who in 1973 would have believed that a newly built typical American home would be 60% bigger than theirs in 45 years?

There's another even more startling factor to take into account. Statista.com claims the average household in 1973 comprised 3.01 people, meaning the home offered 507 square feet per person. But by 2018, that household had shrunk to 2.53 people. And each had 962 square feet to stretch out.

Why the Extra Space?

Many see size as the biggest luxury a house can deliver. Finished basements as guest suites are no longer rare. Many want a study or home office -- often matching his-n-hers. Your master suite is nothing if it's not huge. Your walk-in closet today might be bigger than the bedroom you had as a child. And it's not a master "suite" without its own adjoining bathroom.

Then there are the man caves, she sheds, and bonus rooms -- open space, often on a second floor or wing, where kids can play, work or watch TV without being a nuisance. Ah, the joys of modern parenting.

Average Home Price in the U.S.

The median sales price of existing — not newly built — homes was $274,500 in December 2019, according to research by the Federal Reserve Bank of St. Louis. The US Census says the price for new homes was $29,900 in 1973.

Higher Home Prices Through Inflation — and Much More

But then, a median family's income was just $12,050 in 1973, while it was $73,965 in 2018, again based on U.S. Census data. And it's likely even higher now.

Still, incomes rose only about 600% between 1973 and 2018, but home prices spiked over 900%. Much of that increase in the average home price in the US is due to the increased size of homes.

Yesterday's "luxury" amenities — en-suite baths, laundry rooms and home offices — are standard stuff these days. Not to mention smart appliances, home security, landscape architecture and other gee-whiz features. We pay for that.

And some of the increase can likely be attributed to population growth, increased demand in areas that are already built out, and concentrations of high paying jobs — like software development — in areas with limited housing opportunities.

Popular Home Features

What are those amenities, features and technologies that so many look for in a new home? The U.S. Census listed the percentage of 2018's 840,000 new homes having these popular features:

Air conditioning — 93%

Deck, porch or patio outside: — 92%

Used gas as the main fuel for heating — 60%

Four or more bedrooms — 45%

Three or more bathrooms — 36%

Full or partial basement — 25%

Other popular home features for recent buyers include laundry rooms, garages with storage space, hardwood floors, walk-in pantries and exterior lighting. Another increasingly desirable item on the list is an energy-efficient home.

Developers have opened a luxury residential high-rise on Lake Grapevine in Flower Mound. It is in the Dallas area not very far from where I live in Addison. The 16-story Lakeside Tower has more than 50 luxury homes ranging in size from 1,400 square feet to more than 6,200 square feet. Homes in the project start at more than $750,000. That means if you buy the smallest home, you are paying $535.71 per square foot! The median list price per square foot in Dallas is $202. So, the Lakeside Tower is 265% above the median list price. The residential tower includes a wine room, a yoga room, a club room, a private dining room, a private cinema, a full-service spa, guest suites, a gym, steam rooms, a golf simulator and a pool terrace.

None of the luxurious home I have described above can compare to the original owner of the land in Valley View Park Estates. The Glad Acres Estate covered roughly 1,100 acres. It was a veritable horseman’s paradise and was known as the No. 1 showplace in Dallas. The front lawn alone covered 60 acres, and a full-time staff of more than 100 was needed to take care of it all. There were 13 houses on the estate, including the 26-room, two-story white Austin stone main house occupied by R.B. George and his mother Sudie. It was filled with expensive antiques and included a study that was said to have been entirely furnished in crimson. The home was surrounded by formal gardens, a goldfish fountain, two stables, three barns, spring-fed wells, the first swimming pool in the area, a summer house and several ponds and creeks. There was also a mile-long race track for thoroughbred horses that was built around a lake.