Shrinking new homes, fewer McMansions in Australia

A few years back, Australia passed the United States for largest new homes in the world. Now, new homes in Australia are trending smaller, Australian new are firmly the second largest in the world, and fewer McMansions are under construction:

Australian homes have shrunk to 22-year lows as the “McMansion” fades in popularity and more apartments are built, Australian Bureau of Statistics data reveals.

The average floor size of a new home is now 186.3 square metres, down 1.6 per cent over the past 12 months and the smallest since 1996, according to CommSec’s Home Size Trends Report released on Monday.

More on the longer trends:

The average size of freestanding houses peaked in 2011-12 and has stabilised over the past five years. The average house is 8 per cent bigger than 20 years ago and nearly 30 per cent bigger than 30 years ago in 1987-88.

The standard fit-out is also superior, with higher quality kitchens, bathrooms, floor coverings and inclusions such as air-conditioners.

It is good to have a reminder that new homes can both increase and decrease in size over time. On one hand, smaller new homes would be praised by some as a good move. On the other hand, the long-term shift is still toward larger homes with more expensive features.

It is tempting to consider whether a similar shift could take place in the United States. Could the ever-growing new home in the United States start shrinking as smaller kinds of new housing increase in number? This could happen either two ways: fewer large homes are constructed or more smaller units are constructed (in comparison to each other). I am skeptical this would happen for multiple reasons. Americans still seem to believe in the virtues of having more space and are still willing, to some degree, to tackle the issues that can come with larger houses (i.e., longer commutes, higher taxes, higher maintenance and upkeep costs). Smaller units may be popular in some circles but reasonably-priced apartments, tiny houses, and accessory dwelling units have yet to take off in large numbers. This, of course, could change as households and communities change over the decades, but I do not envision a major reduction in the size new American homes in the near future.

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