Image via Wikipedia
The housing market has remained tired and sluggish since the all too familiar pop of the bubble. In recent years, it appears obvious that families have begun to consider purchasing smaller homes including homes that were once considered unconventional for families like apartments, condominiums or duplexes. As a result, the hardest hit by the continuing decline of the housing market is with large scale or opulent homes. These homes, once considered the optimal for prestige and wealth, have become a slow moving product, as their appeal is no longer an excuse for inflated pricing.
Prices Versus Need
The large home market is, at this point, not on the recovery radar. Buyers simply do not want to deal with the added cost of taxes, utilities and maintenance. This means that they are sitting on the foreclosure market, and will continue to sit because their prices aren’t enticing enough. When being offered a three bedroom, two bath for $60,000.00 versus a four bedroom, three bath for $500,000.00 buyers will choose what they need over what they want.
The Large Home Crisis
This phenomenon can be seen in areas like Los Angeles, Atlanta, New York and many other metropolitan areas that pride themselves on extravagant living. The smaller home market has also attracted investors that are interested in renting and holding onto investment properties. This is especially enticing, as the cost of homes has continued to drop. The overall debt that is incurred through the purchase of a smaller home is considered minimal these days.?Larger homes have now become rock bottom in price, but the cost to build, and remaining balances on mortgages have made these giants tough for even short sell opportunities. It appears that predictions of 1970’s pricing on homes have come to fruition, and that also includes the 1970’s sized home preference as well.