Size matters in the USA

Monday 20th February 2012

Don’t believe them when they say size doesn’t matter. Every homebuyer wants the best deal – and the largest space – for their money when it comes to purchasing a new home.

According to figures released by the National Association of Home Builders, the average size of a new home in the U.S. has increased, with affluent purchasers fuelling demand.

In 2011, the average size of a new build home increased to a record 2,522 square feet – up 6% compared to the previous year.

For the last two years, the average new home size has shrunk as more homebuyers reined in their expectations.

The research also shows that the volume of new houses featuring at least four-bedrooms increased by 42% year-on-year.

"In order to buy a new home in the last two years, you basically had to be a rock star," said builders association researcher Rose Quint. "You had to have 20% down and excellent credit scores.

"It's no surprise first-time homebuyers were left out of the equation."

With most of the new homes going to more affluent buyers, average sell prices have been pushed higher.

The average new house sold in America increased from $264,900 (£167,140) in 2010 to $274,400 (£173,130) in 2011, according to the builders association.

US new home building picks up in January

U.S. home building increased in January from a month before, illustrating the fact that the housing construction sector is going from strength to strength.

According to the Commerce Department, 699,000 new homes are being built annually, up from 689,000 in December and slightly above the average for the last three months. The average for the previous three months was 615,000 units.

The Commerce Department said that the year-on-year rise in January was 9.9%.

"The new home sales numbers have not yet responded but builders seem confident that if they build, buyers will come," said Ian Shepherdson at High Frequency Economics.