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Builders plan to continue thinking small when it comes to homes ; Changing tastes, sluggish economy lead to shrinking houses

Homebuilders are thinking smaller.

They've cut the average size of new houses and expect it to shrink more over the next few years.

"Most builders will build smaller and lower-priced homes in 2011," said Rose Quint, a researcher with the National Association of Home Builders. "Our experts expect the average home size in 2015 to be around 2,150 square feet."

That's down from the 2,377-square-foot average size of single-family homes completed across the country in 2010.

And it's way below the more than 2,500-square-foot average size at the top of the market in 2007.

Nationwide, home sizes are still almost 50 percent ahead of where they were in the 1970s.

Almost 60 percent of builders surveyed said they are planning to cut the size of the houses they build during the next few years.

Housing researchers say the downsizing is due to the dour economy and changing consumer tastes.

"Part of it may be temporary 'because of the recession,' but there are factors behind the decline that are longer term and will stay with us," Quint said.

Costs savings and demographics are also shrinking houses, she said.

"There is an overwhelming desire in the population to keep energy costs down," Quint said.

"Twenty percent of our population will be over 65 in a few decades. They don't want a big home," he said.

The recession and drop in home values have also tempered homebuyers' desires.

"People don't have a lot of equity in their homes to roll into a bigger home. Those times are over," Quint said.

"People have come to realize, 'Let's buy what we need, not what we don't need.' "

To get the heft of houses down, builders are ditching living rooms and dining rooms in favor of multipurpose areas, designed for more than one activity.

More than 80 percent of builders say they expect to do away with formal living rooms, and the number of houses with three or more bathrooms and four or more bedrooms is dwindling.

But some things aren't changing: Buyers say they won't compromise when it comes to storage space. And green features are still growing in popularity with both builders and consumers.

More than 80 percent of potential buyers list energy-efficient heating, air-conditioning and appliances as "must-haves" in their new home.

The number of homebuyers who listed price as their top concern dropped slightly in 2010.

"They will spend on what gives value and what counts," said Better Homes and Gardens' Jill Waage. "They are also spending within more realistic means."

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