Good things come in smaller packages. At least that’s the
feeling today among many homebuyers, who are increasingly interested in smaller
spaces instead of the large that were popular in the ’80s and ’90s. We are certainly seeing this national
trend play out in the Brandywine Valley real estate market.

The major factor leading this trend is the aging of the Baby
Boomer generation. This group,
which has just started turning 65, is ready to downsize. Boomers no longer need
four or five bedrooms and are looking for spaces that are more in tune to their
lifestyles as empty nesters. In fact, the latest U.S. Census Bureau reported
that a little over 60 percent of all U.S. households are comprised of just one
or two people.

While affordability is the number 1 driver for this trend,
other factors do play a role, as buyers are more concerned with how much they
will be paying each month on their energy, water and heating bills.

“You can add better insulation, new windows and insulated
doors, but nothing saves energy like a slightly smaller home,” said Danny
Gough, an energy auditor for the consultant firm, Energy Solutions, based in
North Carolina. “We have seen an interest in smaller homes because of this.”

Conservation is the new watchword in new-home building and
existing home sales, as buyers want to conserve their larger down payments and
their future dollars by buying homes they need, not homes that impress the
neighbors.

According to a recent study by the National Association of
Home Builders, by 2015 new homes will not only be greener and packed with more
technological features than today’s homes, but they will be 10 percent smaller.
In its report, “The New Home in 2015,” the NAHB points to the economic downturn
for a “less is more” mentality.

“People are looking beyond what they pay in principal,
interest and taxes and look closer at what they will be paying each month,”
said Stephen Melman, director, Economic Services, Economics and Housing Policy
for the NAHB. “Buyers, despite excellent prices and low interest rates, are
cautious and are going to purchase the home that they need and not necessarily
even the home they can afford. They are very careful.”

This trend has developed quickly. At the beginning of 2007,
the median floor area of new homes started was just over 2,300 square feet. The
median floor area of new homes dropped to nearly 2,100 square feet by the end
of 2010.

“That’s close to a 9 percent decline in floor area over a
very short period,” Melman said. “Total floor area isn’t what’s important
there, but the amenities inside the home itself.”

Rooms that are falling out of favor in new homes include
media rooms, sunrooms, mudrooms and libraries. Echoing entryways, vaulted
ceilings and giant pantries are also less popular.

The report even said that the living room is dying out and
will either vanish, merge with another room or become a smaller parlor.

“People are asking what they can truly do without,” Melman
said. “Almost 50 percent of buyers surveyed said they would be willing to give
up the living room if affordability is an issue.”

* Jim DeFrank and Beth
Alois can be reached at 610-388-3700. Prudential Fox & Roach is an
independently owned and operated member of Brookfield Residential Property
Services. Equal Housing Opportunity.

About Beth Alois

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