Housing - Why are smaller houses not being built?

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Jun 9, 2014
Central Oklahoma
I know this will probably stir the pot a bit, so let's try not to get this thread locked and keep things pleasant.

In my area (and probably everwhere else) there are endless cookie-cutter, crammed like sardines, abysmally built, entirely overpriced subdivisions being built anywhere they possibly can. It's crazy how quickly. And they all have price tags of $250k+ (I'm in Oklahoma, I understand this is nothing compared to other regions). These houses inevitably will be in shambles in 30-40 years due to the terrible build quality. As someone looking to buy their first house (most likely the one I'm currently renting due to lack of "good" options in the location I want), it's incredibly infuriating that I can't buy or even build what I want where I want it. Especially if you're as anti-HOA as I am (I don't want to turn this into an HOA discussion, that will always end poorly). So I have to ask. Considering the insane number of these high-end, high square footage homes being built, where are the quality, nice, small (1,000 square feet or less) homes? Why isn't anyone building these? The current trend of large expensive homes being built, any semblance of affordable modest housing being "flipped" and inflated out of reach, and rentals bordering armed robbery surely can't continue without consequence. Surely I'm not the only one who can see this..?

Why is living in a 2,000+ square foot house considered normal? Why can't people accept others wanting to live responsibly on their own land? Yes, tiny homes are gaining traction, but very little. It seems all new construction is either 1,800 square feet. Nothing in the middle.

My dream home is an excessively well-built, 2 bedroom, 1 or 2 bath, ~600-800 square foot, insanely energy efficient, simple house. No vaulted ceilings, no crown molding, no granite countertops, no luxuries. Yet no quality corners cut, and appealing to visitors/neighbors/local government. Built to last and save me money. The way a home should be. I've been in contact with builders and contractors, and several of my ideas would cost less than $75k to complete. I don't want a "tiny" (
Yes, I can do this in many areas around the state. Many areas would actually allow a primitive (think hundreds of years ago) cabin, as there's ZERO laws/building codes to enforce. But I want a certain location, and this location has strict codes. I understand codes are generally there for a reason, but it truly seems like the city has them solely to protect property values and drive prices up. With the housing market the way it is, countless people (especially millenials) can't/don't want to pay $200k+ for a home. We just don't want the debt hanging over our heads. So where are the nicely built, small, efficient, affordable homes in good neighborhoods? Especially if doing a community, not just a single home, this can be done for well under $100k per dwelling here including a small lot of land. So many people would buy these before they could lay the foundation. Why is this being ignored?

What's really irritating is there's a small community in my city that strictly houses homeless people. This community has very nice small houses that are given free of charge to shelter those in need. They're about 500 square feet, very well-built, efficient mini-houses. Why can the city allow 50 or so of these homes to be built for the homeless, yet I can't build the same exact thing on my own dime and land? It's infuriating. I'm grateful it provides for the needy, but I'm jealous that people are just given exactly what I want, yet I can't pay to have the same thing. I'm tempted to be "homeless" myself.

What are your thoughts? Am I just too far out of touch? Is my ideal home too crazy to understand? What I can't understand is owning a house with tons of wasted energy, space, and money. I just want to live within my means, responsibly and efficiently, in a desirable location, and I'm being prevented from doing so. Unless I can find a better option, I'm buying the current house I'm in for somewhere between $100-150k. It's too much money, too much space (1,800 square feet), and going to require too much maintenance to get it "acceptable" to my standards. Sound crazy? I agree. But I may not have much choice, considering similar houses are going for $200k, and what I want doesn't exist. I've even considered something like an accessory dwelling setup (ADU), but even that is shot down by building codes here. I literally can't win.

It's weird when someone says "take my money" and people don't care. Does anyone have a similar mentality? I'd love to hear you input. Sorry for the novel, but I've been needing to vent about this for a while.

Edit: I should clarify, when I say house, I mean free-standing single family house. No condos, apartments, townhouses, or I-can't-pee-out-my-window-without-hitting-my-neighbor's-house setups. A house like I'm currently in, with an acre of land, and my closest neighbor is about as far away as I can throw a rock (with a superb throwing arm).
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Housing here in Chattanooga tn ,,same thing..even houses built in the eary 50s are going for 400k dollars. New ones start at 399,000..insane building going on here, especially in apartments along the river...seems there is a building disease going on...for what reasons, ?????
PROFITS!!! Bigger house, bigger profits.No lack of buyers right now for bigger houses. We have the same issue here in State College, PA, home to Penn State. Student rentals drive the price of rental units to the moon and all the highly paid Penn State folks drive housing costs up into the $300-400.000 range or higher. Folks with $30-40,000 annual incomes here have to live many miles away and commute.
I'm friends with a Contractor. The more square footage, greater profit! Opulence = profit.
It's what the market will bear in that area, and it's what the majority of people want. Personally I would not want to be shoehorned into a 1000 square foot bungalow.
And newer houses being poorly constructed? That may be true in your area, but it's not true in a lot of other areas. I rather like high energy efficiency, well designed kitchens, fairly spacious bathrooms, master bathrooms with double sinks and a separate walk in shower, walk in closets, backyard with a pool, amenities like that which you won't get unless you buy a flipped home or something newer. 40s and 50s vintage homes were very rarely built with any of those features.

You could always buy a piece of property and build your "dream home" on it.
I agree with all your comments, and add this. My mother moved from the older part of Sioux Falls to exurban St Louis when she was almost eighty. In her old town she could function on driving on parallel side streets. She could not handle traffic flow consisting of subdivisions with myriad culdesacs emptying into high capacity five lane roads named after the original farmers and meandering from direction to direction until emptying into still larger roads. St Louis has hollowed out into an enormous area with a stagnant ,small population of under 3 million. I'm always shocked at how compact areas with more people like the Twin Cities are. At least OKC is a grid.

Who will buy the McMansions in spaghetti subdivisions that the baby boomers aged in?
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Those Mc Mansions are built and sold for the same reason the Big 2.5 build pickups and Utes . Higher profit margins than cars that face too much competition to be sold for a premium. Ex-house framer turned alarm installer, I was disgusted by the shoddy work and matls. Those huge stair cases from Gone with the wind are the biggest waste of space. Cadillac Fins. Roof trusses make for a fast board-in compared to rafters and joists. and the total elimination of attic space
I totally agree with you Tony. The only way you'll find what you're looking for is to find a "real" house that was built in the 1950s. Real brick, real hardwood,etc. That's why we've rented as long as we have, we can't find that perfect mid-century house we dream of owning. As soon as the perfect one comes up for sale,it's bought immediately. We refuse to buy a cookie cutter piece of junk.
The home you wish to build has limited to no marketability especially if you're not in some sort of resort area where a buyer would consider the structure a second home. For an extreme example think about how marketable a passive house would be in your area. I'd say ZERO.

The biggest misconception about small homes is the assumption that people who lived in small homes in the past actually chose them over larger homes. Affordability was the issue then as it is today. Btw...There's a big difference between a 600 sqft house vs a 1200 sqft house.

A 2,000 sqft house isn't large. Homes over 3,000 sqft are typically considered luxury.

Square footage is cheap so it's the details which matter with regards to air sealing, insulation, HVAC design, etc. Size isn't primarily indicative of energy usage, it's occupant behavior. Theoretically you can build an 3,000 sqft house which uses less energy than a 800 sqft home. It'll cost you 4x to get there however.

Builders want to keep their crews busy. So a low margin build which is completed in a short period isn't worth their time.

There's no commonly accepted definition of "living responsibly".

Production homes will last 30-40 years, they just might not be as comfortable and energy efficient as they could've been. There's nothing magical about older homes. They typically were built with too much wood, were drafty and consequently huge energy hogs. They only "lasted" because they were so drafty that routine wetting would easily dry out.
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Cost per square feet can be the same or lower for a mid-size house vs a smaller one. You have raw over head cost for both like gas line, sewer, etc... hook ups, HVAC still needs runs, driveway, etc... So a 1000 sq/ft house is not much cheaper to build then a 1500+. But one will sell faster on average and at a higher profit margin.
Stupid question but what is preventing you from buying a lot and putting your dream house on it? Is there some weird zoning law that states a minimum SqFt? Or are no contractors willing to take on such a small project?
In my area most sites legally mandate a 1500sqft first floor, meaning that is the smallest home you could possibly build assuming no basement or 2nd story.
What compounds the frustration is most lots are 1/10th an acre and setbacks are growing 30ft +

This law changes combined with the town demolishing low income housing and the fact there is work here (at the moment) is driving up housing and property taxes on old 100 year old dives.
When I've seen these factors in the past it results in a market collapse and more slum lords buy up housing expanding blite.

If you want to build a small home you need to change laws or buy an antique that meets your requirements or move to an area without legal issues.
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Originally Posted by Eddie
Probably the same reason some people buy large pickup truck for driving themselves around town. EGO is the reason. Ed

This is a lot of it. Everybody wants a "showoff" home...I'm not into that myself. I would rather have a lot of disposable income to enjoy life with, rather than being a slave to a mortgage payment...my wife and I were friends with a couple that used to buy the most home they could get approved for...they had nice houses, but they never had any money to do anything with...they were always broke...
Originally Posted by csandste
Who will buy the McMansions in spaghetti subdivisions that the baby boomers aged in?

Spaghetti subdivisions started in the 1940's, were encouraged by the Dept of Housing and Urban Development, in order to slow down traffic and discourage drivers from using the neighborhoods as a cut-through.
In my neck of the woods we have a lot of 1920's and 30's houses that are under 1000 sf. Can't find one for less than $250k unless it is really dilapidated. That is changing a bit as prices have started to drop here.

I'm in agreement with the idea. A smaller house means less money spent on energy and maintenance.
The market has spoken.
I am guessing that in OK land is cheap so you are paying for the house.
Where I live the opposite is true.

In an urban area, you have less choice regarding housing, which is what you are seeing.
Heck, in Silicon Valley, $700K maybe gets you a small 2 bedroom condo with a carport.

Good luck in your home search.
I have friends that build houses. They built one similar to yours, about 1400 square foot, 3 bedroom, solid poured foundation, crawl space 2X6 walls, double hung windows, attic fan with insulation box for when it is off, extra insulation, 26 Seer ducless heat pumps, all LED lighting, ceiling fans. Granite counters, all Oak trim, tile, thick carpet, laminate floors. Solid floor, sub floor glued and screwed. Foundation perimeter insulated and drain system so no water accumulation(big problem around here). Termite treated foundation before pour. . Trusses, 2 ft overhang, hurricane straps, Metal roof, solar. Sold for same price as the 2000+ square foot town homes (about 250 300K) Hardy cement board siding. Owner gets tax credits for solar, energy rebates etc. 1500 square foot. With the solar, it can run a week using a generator at night on less than 10 gallons of fuel a week so when the big ice storm or tornado hit, they still have comfort.

Did not sell. The realtors told him every possible customer that could swing the payment bought the junk bigger house, saying how they loved the room. None of them even planned to be in it more than 10 years. They hoped to be in an even bigger one by then. Just the way people are wired. One of the contractors supervisors bought it.

His monthly electric bill is around 100 (His wife is a hot water hog).

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Same thing happening here in Jacksonville, Florida. Insanity the rate at which housing is being built and the roads aren't getting any bigger. It's really irritating.

Unfortunately the wife and I are saddled with student debt and can't afford to purchase a home and are forced to rent. Which costs us way more than a mortgage would. This is a serious issue for the American economy.
Profit, but that's not the only answer.

Zoning, or rather property taxes, are also higher on the bigger/more expensive houses so governing bodies have tended to not approve smaller-sized houses. Some may argue that the government could make more tax revenue on more, smaller houses in the same footprint, but with more houses comes more need for services like schools so there goes that 'extra' revenue.

Also, as has already been said, ego plays a lot into it. I grew up in a house that was under 1100 square feet and it handled a family of 4 very well. Today that house would be considered cramped. I was going through the models of a new subdivision being built near me and there was a young couple going through the model at the same time I was. IIRC, the house was 2600 square feet and I remember hearing the woman complain that the house may still be too small for her, the husband, and the *one* baby on the way.
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