Production Builders Bring Bigger New Homes Across The Nation, But Not in North Texas

Production builders across the nation are upping the ante on square footage for space-hungry buyers, says a new report from the National Association of Home Builders.

According to Census numbers analyzed by NAHB, the median single-family square floor area increased by 9.3 percent since Great Recession levels, while the average home’s floor area is up by 6.2 percent.

While that may be true on the national scene, experts in Dallas paint a far different picture.

Dallas Bucks The Trend

Statistics on housing starts for 2019, 2020, and 2021 show that production builders are pretty level. In fact, numbers produced by Zonda for the Dallas Builders Association covering the 2019 and 2021 market show that the average square footage of production homes has remained almost the same over the three-year period, with the minimum unit size in a new production development shrinking from 2,057 square feet in 2019 to 2,048 in 2021.

“As far as why DFW is bucking the trend, I suspect it is because this market is so price-sensitive,” said Phil Crone, executive officer of the Dallas Builders Association. “Specifically, the social pressure from the pandemic towards larger homes has been mitigated by the massive material price increases caused by the pandemic’s economic fallout.”

The overall cost to build a home has increased dramatically since the start of the pandemic. Despite some measures of relief when it comes to lumber prices, everything else that goes into a home just keeps getting more and more expensive.

“Lumber prices have fallen, but overall building material prices have increased, up 22 percent during the past 12 months and up 19 percent year to date (including energy),” said Danushka Nanayakkara-Skillington, NAHB’s assistant vice president of forecasting and analysis, in a Q&A. “There are also longer delivery times. Builders are reporting shortages of cabinets, appliances, windows, roofing materials, etc.”

A Different Story in The Luxury Market

However, in the custom home market, a different picture is forming. Builder Adam Lingenfelter of Lingenfelter Custom Homes believes that in his experience, custom builds are going big in a big way.

“I have not been formally tracking this trend, but I would say that our average AC square footage has jumped 15 tp 20 percent after the pandemic,” said Lingenfelter.

Admittedly, Lingenfelter’s builds are not an apples-to-apples comparison when it comes to production housing, especially the growing “suburban shift” as economists call it, which is the rush to build new homes farther afield for buyers who want affordable, newer construction.

It’s not just the house that’s getting bigger, either, Lingenfelter said. The pandemic has influenced luxury homes to a point where new builds are dialed in for post-COVID life.

“Our average garage square footages are up 20 to 25 percent, and our patios are up roughly 100 percent on average,” he stated. “Buyers are telling us that after going through being stuck at their home for a year they want to make their future homes set up for both wage earners to comfortably work from home for long periods of time if this were to happen again. They also want to have the ability to have more outdoor living space and garage space to make their time at home as comfortable as possible and better for entertaining (if they are not allowed to go to restaurants etc. in the future).”