Home builders are reducing the size and options available to appeal to buyers with less money to spend and who are facing a harder time getting financing.
Los Angeles-based KB Homes had shrunk its homes from 3,400 square feet, selling for $450,000, to 2,400 square feet selling for $300,000 to appeal to buyers. Now, it’s shrinking its homes yet again–1,230 square feet priced at about $200,000
Other builders, including Warmington Homes and John Laing Homes, have taken similar approaches.
â€œWe’re getting back to more the way things were historically, kind of undoing the excesses, not just from a price perspective but home size and (fewer amenities),” says Nishu Sood, a Deutsche Bank analyst.
The new KB Homes arenâ€™t just smaller, they are more efficiently designed, says Steve Ruffner, president of KB Home’s Southern California Coastal Division.
“You could have a three-bedroom, 2,500 square-foot single-story home and all you had was wide hallways and bigger rooms. It wasn’t really giving [buyers] the utility,” Ruffner says.
Source: The Associated Press, Alex Veiga (10/10/08)