U.S. — The average size of new homes in the U.S. is 2,175 square feet, a 5.6% decline from the peak reached in February 2019, according to a NewHomeSource report. More than 80% of the top 50 housing markets saw average home sizes shrink between 2019 and 2025. Median single-family home prices rose nearly 48% between 2019 and 2024, according to the Harvard Joint Center for Housing Studies.

New homes priced at $350,000 or lower previously accounted for 42% of all new homes built but now account for about 21%. Charlotte and Raleigh home sizes fell roughly 10%, or about 250 square feet, since 2019. Nine of the top 50 U.S. housing markets posted size gains, with New York seeing the largest increase nationally at 11%.

Ali Wolf, chief economist at Zonda and NewHomeSource, stated, "When mortgage rates and prices stay elevated, buyers make trade-offs, and square footage is usually the first to go." She added, "Size is the most flexible variable in the homebuying equation right now." Wolf noted, "I can't afford a home, and the home that I can afford is getting smaller." Regarding regional trends, she said, "California [became] kind of a running joke in the industry for construction, where they say 'oh, California, there's so much regulation, there's so many limits to new home building.'" However, "builders in Florida and builders in Texas are now saying, 'okay, we know we've laughed at them in the past, but what are people doing in California? Because California is basically the cutting edge of new design.'" Wolf also addressed potential downsides: "This all sounds great, and I think a lot of people are like, where's the catch? Because now you know this sounds almost too good to be true." She explained, "And it's because housing demand has been so slow for so long that the catch comes to the builder, not to the consumer." Finally, she warned, "If someone buys a home today with a buy-down of 5% and interest rates don't come down in a couple of years, they might find themselves a little bit stuck in that home."