The home of the future: smaller, simpler, more affordable
Filed under: Budgets, Home, Real Estate, Saving Money, Mortgages, Cyber Monday
Marianne Cusato was busy designing cottages for people displaced by Hurricane Katrina when requests started pouring in from developers, builders and homeowners across the country begging her to create a similarly compact dwelling for them."I was very focused on disaster housing and the small-house movement came to me," Cusato told WalletPop.
Though Cusato's 300- to 1,800-square-foot Katrina Cottages -- now for sale at Lowe's -- are an extreme example of the smaller-is-better mentality, the movement appears to be more than a fad, especially now that the economy has tanked.
A slew of surveys shows that homeowners are looking to slim down, hoping for less space to heat, cool and clean, and cheaper mortgage payments. A recent CNN poll found 69% of respondents felt homes had gotten too big and Kermit Baker, an American Institute of Architects economist, reported in October that while people want a home office more than ever (reflecting in part the growing number of self-employed and telecommuting workers), special-function rooms such as home theaters, exercise rooms, guest wings and three-car garages have become less popular.
Consumers are also abandoning some of the excesses that had come to define the modern home before the housing bubble burst: living rooms in addition to family rooms, big master bedrooms with big master baths, walk-in showers that are adjacent to standalone Jacuzzi tubs, pantries the size of closets and closets the size of bedrooms.
Soraida Oquendo of Shrewsbury, Mass., is among those homeowners desperately seeking to downsize. Her 4,369-square-foot home, now for sale, includes a full basement and a pool -- both amenities that seemed perfect when her two children still lived there. But now she and her husband yearn for a house that's half the size and more affordable. The economic downturn, she says, has hit their liquor store business and the family's finances.
"I'd like something only one floor...the most three bedrooms. Bathrooms? Two and a half would be fine. No big dining room. Something very simple and easy to clean," Oquendo said.
Robert Lang, director of Brookings Mountain West, an urban development research partnership between the Brookings Institution and the University of Nevada, Las Vegas, sees the downsizing trend as a pendulum swing from just a few years ago. The sociologist describes the previous upsizing of housing as "the Tuscanization of wealth," in which Tuscany-style homes grew ever larger as they were layered with add-on after add-on. "There were oversized entry halls, grand staircases," he told WalletPop. "Their purpose was to demonstrate status."
While the Oquendos are more traditional downsizers -- empty-nesters ready to move on -- Christine Harmel of Austin, Tex., is part of the new wave of less-is-more-leaning homeowners. Harmel, who does public relations for green companies, moved last year from a three-bedroom, three-and-a-half bath home in Charleston, S.C., to half of a 1,200-square-foot duplex.
The hardest thing to give up was the kitchen, she said, since she likes to entertain. Now she plans parties for good weather so she can hold them outdoors -- and warns people not to come if it rains.
A National Association of Home Builders survey found the downsizing trend started back in 2007, when potential buyers were asked what trade offs they would prefer if costs exceeded their budget. In 2007, 58% said they would choose a smaller house with high quality materials and amenities over a bigger home with fewer amenities. In 2004, only 37% said they would make that choice. During that period, the desired square footage dropped from 2,426 square feet to 2,292.
"The living room is the most likely to disappear when the buyer is forced to choose," Stephen Melman, the NAHB's director of economic services, told WalletPop. Also on the chopping block: giant kitchens and large master baths.
A recent Wall Street Journal article said builders have become so convinced of the trend that they are making some of the choices for consumers, drawing up blueprints without the grand foyers and staircases, forgoing fireplaces and reconfiguring garages so that cars park end to end instead of side by side.
The Katrina designer, Cusato, has responded to the downsizing movement with the soon-to-be unveiled "New Economy Home" models. "I'm shifting from natural disasters to man-made disasters: the economy," she said.
At 1,676-square feet, Cusato's floor plans offer several options, including a downstairs suite that can ebb and flow with a family's needs, starting out as a family room or office, morphing into a rental or in-law housing and perhaps later a downstairs master bedroom for retired homeowners. Cusato even suggests it could allow a divorced couple to continue to share the house if finances demanded it. What you won't see in Cusato's blueprints are large hallways, giant master suites, media rooms and her least favorite luxury: the Roman tub.
The smaller-is-better movement isn't just a passing fad, said the NAHB's Melman. Baby Boomers are now empty nesters and they simply don't need as much space. Combine that with a recession and it appears this trend has legs.
"The trend of increased floor area over the past 35 years declined slightly during previous recessions in 1975, 1980-82 and the early 1990s. But this time it could be more permanent," he said. "The depth of the recession and anticipation of increased energy costs combine with demographics this time."
MoreOli Scarff, Getty Images
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Reader Comments (Page 1 of 3)
11-24-2009 @ 8:05PM
Sarah said...
If you can afford a big home on a solid loan without depending on someone like me to pay half the mortgage; fine. Otherwise know your place and get what your one income can afford on it's own. I have my own small home which has brought me happiness and really controlled finances for life. Building owners in certain parts of the country charge too much and give you nothing in return and will squeeze every last penny of your salary so they can live off of you spending your money on lattes and text messages besides their own mortgage so THEIR wife can stay at home, while yours plays the fool by playing the game that's been expected all of these years. Which I didn't do btw....don't follow the crowd to be a part and fit in and qualify for a marriage based on what you "bring to the table" that's visible. You'll be working the rest of your life if you can even find employment for those massive bills that await you; all so that some CA or west coast man can prove to himself and everyone else that he's GETTING something. If they can't afford the area on their own terms, they need to know their place and MOVE.
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12-06-2009 @ 8:39PM
lena said...
i totally completely agree. Most people do not understand what they are getting into until its too late or even end up in foreclosure. and as for buying a house based on what one income can afford is the smart financial way to go.
12-07-2009 @ 12:02PM
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11-24-2009 @ 8:18PM
Sarah said...
Why don't some people know their place anymore; a bad loan means you can't afford it. Real legal money is hard to earn; if they were living on real money they wouldn't be spending it so irresponsibly.
Easy come, easy go.
When men rely on women for money it makes them weaker. Although I have seen what people turn into, both men and women, when they either refuse to work, thinking they're above it and owed something, or when they don't want any partner so as not to benefit them (they get mentally ill from nothing else to think about, and from loneliness), I still think a womans income should not be used 50/50 and as a qualifier for marriage and splitting lifes bills. Get a roommate for that.
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12-07-2009 @ 7:56PM
Joel said...
Wow!
So, if a woman works, which I kinda feel you're against (but could be wrong), she should not use her earnings to support the family? Because it makes a man weaker?
My wife is a PhD, a university professor and a special advisor to a federal regulatory board. She works VERY hard. Why shouldn't she be allowed to have her hard work and significant earnings included in a loan consideration? It's her home and life, too.
My wife is very strong-willed, and we butt heads regularly, but one word she would never use to describe me is weak. As well as my wife does, I make 38% more than her. And we also run a side business together that brings in additional income above our salaried positions.
My wife is my partner in every sense of the word. To deny her acknowledgement of her work is sexist.
Having said that, I do agree that it is a prudent financial strategy to only use one spouse's (EITHER one) income and credit for a loan. It will force you to get a smaller, more affordable home, allow you to hoard cash and be better prepared for life's hardships, or allow you to pursue personal interests like travel.
It's a good idea, just not with the sexist agenda of excluding a woman's pay in order to protect some fragile and outmoded gender roles.
11-24-2009 @ 8:34PM
Sarah said...
Nothing has made me happier in my adult life then to be a small homeowner. In expensive areas, even doctors can only afford a small home and it's still considered prestigious. But what should be prestigious is your savings to loan remainder ratio, not the outer appearance of...wow, I was about to say extravagance but what they have for the high prices isn't even ordinary...success. Only you need to know you are doing the right thing, and trapping people into mortgages and rents to give yourself a false sense of well being and confidence is not the route to financial wellness. Be free of the extent of financial trauma that's available and appreciate the person. Be what you expect of others and set an example instead of an expectation; it works much better.
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12-06-2009 @ 12:00PM
Mike said...
This is just a spin (IMO) of the 'everyone wants to live in the core of a city' song and dance that central planners (didn't they have those in communist Russia, and it worked so well) have been singing for some time. Hey, I agree, number one, don't buy a house bigger (or at least with a bigger mortgage) than you can afford. However, that logic goes for ANY purchase.
It use to be that you bought a 'starter house', now days that might be a 1200 to 1500 sq ft house, typically 3 bedroom and 2 bath and you build equity and get on your feet. Typically within 10 years or less, you have equity in the house, your income has gone up, the value of the house has gone up, you move to a bigger house to finish (if you've started, which you probably have) raising the kids. It's a tried and true formula and it works.
As for downsizing in your golden years, it depends on the couple. I'm actually looking at moving up in size as I really fear that both my daughters might have something happen in their marriages and I will need the extra room for them and the grand kids. Even if that doesn't happen, the extra room for guests, for making it into a workout room and office, the list goes on.
Again, it's nice we have choices, however, with the 'planners' of this world and our cities ... they want to limit those choices, be careful. And no, a smaller house wouldn't be high on my list.
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12-07-2009 @ 4:05AM
Steve in DC said...
One problem.... the cycle of home-ownership that you claim "works" ....well... in fact, doesn't. We will not be able to maintain the wastefull behavior that this pattern involves. The world has changed. We cannot afford that life... at least the honest people in our society cannot. Most of the the few who will want to continue with the waste are parasites.
12-06-2009 @ 12:51PM
Brad said...
After traveling extensively throughout the world, I now know that America is headed down the toilet. The big corporations are going to own us all. The only answer, if you can afford it, is to leave our once proud nation. There are so many other places to live, ones with GOOD healthcare and much less expensive cost of living.
I know I'll be heading out soon.... my money will let me live like a king in some other locations. Once you travel, and spend time in certain other places, you realize how we are being duped here.
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12-07-2009 @ 3:06AM
Patricia said...
Well you just go for it - the grass is not always greener on the other side of the street though - and I'm quite sure you'll find that out real quick. Freedom does not come cheaply - remember that, and it may not be all that easy for you to come back should you decide to do that one day.
12-07-2009 @ 5:13AM
Been There said...
It's not like Brad didn't say he has traveled the world extensively.. he did say that.. and he knows what's out there. And it's not like the USA is the only country with "freedom". Freedom in the USA has become not much more than a hollow word for it's citizens to knock on and hear the noise. There are many other countries that are a whole lot more free than the United States and still offer their citizens the comforts and security that the US government would like you to think Americans have the market cornered on when, in fact, it's just that hollow word again. Silly Americans. True freedom in the United States evaporated decades ago.
12-09-2009 @ 7:29PM
Bruce said...
Been thinking something similar to this for awhile now. Any suggestions on places to "migrate" to? ie. what would your top three picks be?
12-08-2009 @ 12:39PM
scott said...
Freedom isn't free. It costs a buck o' five.
12-06-2009 @ 1:46PM
Maryann Purgason said...
We downsized 14 years ago in order to pay for our home outright. It is smaller, has less storage, which prompted a huge rakeout before we moved. I couldn't tell you what I gave away or threw out, since I don't miss it and I continue to discard or donate non-essentials.
We miss neither the mortgage nor the stairs. We refused to consider the "equity-line-of-credit" idea for consumer purchases and when the credit crunch hit, our home was safe. We do not consider ANY questionable credit business that involves our home.
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12-09-2009 @ 12:22AM
Gloria Collins said...
I have 7300 heated feet a and 2300 feet in the garage, stoop and verandas, but could use a little more space, so, I don't think family's who can afford the space will be moving onto what I call little boxes.
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12-08-2009 @ 7:44PM
MCG said...
who needs that much space? Hoarders!!...That is too much space to place too many things..
12-10-2009 @ 11:54AM
Ken said...
What are you doing with all that space? Are you living in a Wal-mart, or just herding cattle?
12-06-2009 @ 3:13PM
Terry said...
Yeah! Inflation and our soon to be third world Country is Lowering our standard of living, at avery Rapid Rate !!!
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12-06-2009 @ 4:07PM
EBlisster said...
I'm surprised they didn't talk to The Not So Big House designers who are apparently well ahead of their time. They've been promoting smaller nicer homes for over a decade now.
I would still like a big soaking tub.
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12-06-2009 @ 4:11PM
Dennis said...
My wife and I are really happy we did not upgrade three years ago when we were looking. We came to the conclusion that we could afford our smaller (1460SQFT) home on much less than we make. We made some improvements and added a porch. Now we don't feel the stress that a larger home would have caused in this down turn.
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