A home built by Niroo Masterpieces.
As UrbanTurf recently reported, the dynamics of demand in the housing market in the early 2000s looked quite different compared to today.
One nearly-forgotten phenomenon was the rise of the McMansion, once in high demand and the epitome of the suburban lifestyle. Now, Trulia has released a study examining how the premium to purchase a McMansion has dropped appreciably across the country.
To be sure, Trulia’s definition of a McMansion — single-family houses built between 2001 and 2007 that were 3,000-5,000 square feet in size, roughly 1.5 to 2.5 times larger than the median size of a new home in 2000 — is not perfect, as aesthetics plays an equally important role in the McMansion definition as size. The study compares the price of McMansions to all other houses in each market that do not fit both the size and construction time parameters given to McMansions.
The premium paid for a McMansion fell in 85 of the 100 largest housing markets examined between 2012 and 2016, and dropped 21 percent nationwide — from 138 percent in 2012 to 117 percent this year. Eight of the top 10 metropolitan areas where McMansions have fallen out of favor are in the state of Florida.
McMansions have taken less of a hit in the DC region, with the price premium dropping by 12 percent between 2012 and 2016. The drop is slightly more noticeable when examining the regional market over the past decade, as the premium fell from 76.1 percent in 2006 to 58.9 percent currently.
While all housing prices took a major hit as a result of the housing bust in 2008, the prices of non-McMansions have experienced a stronger recovery. That said, homebuyers have not completely lost their appetite for newly-constructed houses, which still fetch 20 percent more than their older counterparts — and McMansions have aged into the latter category.
This article originally published at https://dc.urbanturf.com/articles/blog/muted_enthusiasm_for_mcmansions_in_the_dc_metro/11614.
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