Post-Pandemic Home Building Trends: More Bedrooms, Smaller Homes

Contradictory conclusions about the direction of the new-build housing market circulated online on the same day this month.

On August 22, an article by Justin Fox for Bloomberg included the following data to support an article about the increasing number of bedrooms in newly constructed housing units.

Of the just over a million new single-family houses completed in the US last year, 490,000 had four or more bedrooms. That worked out to a 48% share, the highest since the US Census Bureau started keeping track in 1973—and more than double the percentage in 1973.

Another article, by Maggie Eastland for the Wall Street Journal [paywall], reported on generally shrinking footprints of new housing construction:

Since 2018, the average unit size for new housing starts has decreased 10% nationally to 2,420 square feet, according to Livabl by Zonda, a listing platform for new construction homes. Construction starts for new single-family homes declined in 2022. But starts for homes with fewer than three bedrooms increased 9.5% over the same period, according to a Zillow report.

The stories don’t totally reach opposite conclusions, however. Fox’s coverage acknowledge’s that the increase in the number of bedrooms doesn’t necessarily mean a commensurate increase in square footage:

While the median floor area of new single-family houses rose slightly in 2022, to 2,299 square feet, it’s still below pre-pandemic levels, and quarterly statistics on housing starts indicate that it will fall in 2023. But the uses to which that space is put are changing.

Further complicating any simple interpretation of the two stories are the explanations behind each of the trends reported by these two articles. Both assumptions seem reasonable: Americans want more bedrooms to facilitate working from home, according to the story about homes adding bedrooms, and less square footage is intended to lower the cost of housing, according to the story about homes decreasing in square footage.