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New home designs are constantly changing based on the latest trends and homebuyer preferences. What was ideal for homebuyers in the 1950s isn't necessarily what homebuyers today are looking for. Even a decade can make a huge difference. Here are four ways new homes have changed from 2010 to 2020.
The location takes the cake
Location is just as important to new homebuyers in 2020 as it was in 2010. However, what the location offers seems to be more important than the location itself. Many of the millennial and Generation Z buyers entering the housing market work remotely from the comfort of their homes. Eliminating the daily commute means the physical location of the home is inferior to the amenities available around the home and the quality of the home itself.
Homebuyers are looking for comfort and conveniences like large retail stores, supermarkets, shops, and restaurants, so new home construction is adapting to meet that demand. There surely is new construction in large metro cities, but we're seeing far fewer single-family detached homes in densely populated areas.
Technology has improved greatly over the past 10 years, including what is available for new homes. Emphasis on energy efficiency has home builders focused on incorporating the latest technologies to improve the functionality of the home, like smart thermostats and home control systems.
But technological advances don't stop there. In the coming decade, we could see new homes being built with new technology like 3D printing, which could dramatically lower the overall cost and turnaround time for a new home.
The lack of housing, especially in high-cost and highly populated metro areas, may lead some to believe that smaller is the solution and is what new homebuyers, especially millennials, want. But in reality, new home sizes have increased over the past 10 years.
In 2010, 59% of new single-family homes were smaller than 2,400 square feet, per U.S. Census data. Additionally, the percentage of new homes that were smaller than 1,800 square feet fell by 9% in the last ten years.
According to third-quarter 2019 data from the Census Quarterly Starts and Completions by Purpose and Design and NAHB analysis, the average square footage for a single-family home built in 2019 was 2,511, 6% higher than the average square footage of new homes built in 2010.
Historically, homes with three or four bedrooms have consistently made up the largest division of newly constructed homes, and homes with two bedrooms or less or five bedrooms or more have made up the lowest percentages.
According to the National Association of Home Builders and data derived from the U.S. Census Bureau’s Survey of Construction (SOC), there has been a shift toward a higher percentage of four- and five-bedroom homes being built over the past decade. And while it's fluctuated over the past ten years, two-bathroom homes still dominate new construction trends.
New home construction in 2020 and beyond
While homes have gotten larger, we could see this trend reverse in the coming decade to meet the need and demand for affordable housing. It's likely home builders will transition to more entry-level housing that is smaller in size and lower in cost, which focuses on functionality and efficiency.
Trends always change, and what's in demand now will change in the next year or ten years. What it really comes down to is the numbers and what consumers are buying.
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