Why some new Indy homes are getting smaller
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Illustration: Lindsey Bailey/Axios
Expect fewer hallways and more nooks that work as offices or pet rooms in newly built homes in Indiana and across the country.
Why it matters: Many builders and architects say they're using every square foot of space and shrinking house sizes to cut costs and attract first-time buyers.
- "All that Tetris we played in the '90s has finally paid off," experts at John Burns Research and Consulting wrote in a recent report, surveying industry pros nationwide.
Zoom in: Major home builders like Lennar and DR Horton are leaning into compact houses and townhouses featuring open floor plans with office and flex space in the Indianapolis area.
- On Indy's northwest side, Lennar is developing Ashton, a community of single-family homes between 1,500 and 1,700 square feet with open layouts that combine the kitchen, dining area and great room.
- Prices range from $290,000-$315,000.
- A similar open layout approach is being taken with New Haven, an upcoming Lennar development in Westfield that lists 1,800-square-foot townhomes with 4 bedrooms and 2.5 bathrooms for around $370,000.
Zoom out: According to the U.S. Census Bureau, the average single-family home under construction in the first quarter of 2024 had a median of 2,140 square feet of floor space, down from 2,256 square feet the year before.
- That is the smallest new home size since the second half of 2009, per a National Association of Home Builders study.
Stunning stat: More than a third (38%) of U.S. builders say they constructed smaller houses last year, and 26% plan to go even smaller this year, according to the National Association of Home Builders.
- The downward trend comes as higher interest rates have hiked costs for both buyers and builders.
Flashback: Builders mostly focused on larger houses after the Great Recession, but more starter homes were developed between 2016 and 2020, according to the group's chief economist Robert Dietz.
- The size of new single-family homes expanded briefly during the post-COVID construction boom, when people sought more space and interest rates were lower.
What's next: Starter homes might look cramped with tighter kitchens and outdoor spaces, John Burns Research and Consulting found.

