Home Sweet McHome

As you read this, I should be flying back East from a conference on the home building industry. I am not a home builder and never plan to be. But I learned some interesting things about the future of America.

The group I was with represented the top 100 or so home builders, and they listened to two days of experts, analysts, and peers make predictions. The home building industry is about to hit a slowdown, but they’re coming off the best 15-year run of their history, and long term they will thrive. This is what I learned*:

• 20 years out, the population of the U.S. will have increased from 280 million to 370 million. This means that the number of households will increase from about 120 million to 160 million. That’s a lot of new homes.
• McMansions – or large lot houses as I and my industry friends like to say – will eventually lose value. There is over supply of this housing type long-term and shifting demographics will eventually mean that the houses are worth less than their mortgages. Ha ha. We all feel vindicated now.
• Over the last ten years houses have gotten bigger – increasing from an average of 1,500 square feet to 2,200 square feet. The big room of desire is now the entertainment room with oversized TV screens. Why does that make me feel nauseous?
• Empty nesters are turning out to be fabulous. They’re abandoning their large homes and moving into the cities or the closed-in suburbs. They are buying condos and simplifying their lives so that they can go traveling at will. They are helping drive the regeneration of urban centers. Go boomers!
• The boomers are now known as the sandwich generation because they are sandwiched by their kids who finally went to college, but now care for their aging parents whose generation did not have Suze Orman to show them how to invest for their retirement. And guess what? The kids keep coming back.
• Back in the 1980s, the industry was worried about the baby bust — the massive decrease in birthrate and, ultimately, homebuyers. But that fear was washed away by immigration, which is providing huge new markets for the homebuilders.
• America is this really big country, right? But everyone lives in the same few places. And the new population growth is going to be in the south and west. California, Florida, and Texas, followed by Arizona, Nevada, and Utah. It seems we’re inexorably drawn to places with high disaster risk, which require unsustainable amounts of water and energy to be livable. Go figure. (And with the notable exception of California, this does not bode well for blue state growth.)

The ultimate impact of this information was to make me feel small and powerless. Population and economic growth are juggernauts that will determine everything. And there’s apparently no interest in the quality of design. It seems everyone wants a Colonial Revival-style home. Take me home to D.C., please.

*Disclaimer: I did not take notes, so these are approximate interpretations of the data presented extracted from my shaky memory.

3 responses to “Home Sweet McHome”

  1. I love the contrast between your post and Trixie’s, one right after the other — and between the declining-value McMansions you describe and the gorgeous urban revival project T&R have thrown themselves and several sledgehammers into.

  2. Rachel says:

    Where I live the McMansions are built on lots of North Shore land that are currently occupied by “teardowns”–i.e., adorable old houses that people destroy in order to build something much uglier. (Can you imagine having so much money that you could buy a functional house expressly to tear it down?) The thought of all those big boxes stuck with negative equity does indeed seem like just desserts.

    What would the largest room of your dream house be? I vote kitchen. Or library.

  3. PB says:

    OK, so I am a huge fan of your posts on even the most ordinary brilliant days–but this one has me all lathered up! Like Rachel, I live in the land of tear-down and archectural throw-ups. Not only are these houses way too large, but they are such lego-maniac bad taste that I cannot even bear to drive by. I rant every time we pass one. If only they were just bad monuments of keeping up with Jones, but in today’s world of shortage and inequality, they seem to mock the face of greater need. So, I will cling to your shaky memory and go read Shelly’s “Ozymandias” once more with glee.