Living Large

In the middle of the housing recession, when most builders were shrinking their homes and industry pundits were declaring the demise of McMansions, Meritage Homes was building bigger — a lot bigger.

As the average home ticked down closer to 2,000 square feet, and as designers and architects talked about “jewel-box” homes, Meritage rolled out models that were 5,000 square feet-plus.

The homes, with so many bedrooms visitors lost track when they walked through, carried price tags so reasonable that even families with no need for more bedrooms than you could count on one hand snatched them up.

“It helped brand us here in the Orlando market,” says Brian Kittle, Meritage’s Orlando division vice president, who was in charge of sales at the time. “It’s still a core of our business. It’s what we’re known for.”

It wasn’t just the size of the houses that sold them. Like big-box stores, big-box houses offered bargains. The cost was low because the homes were built on land bought cheaply during the recession. from builders who needed to unload it. Also, the designs were simple and the interiors basic.

Both factors contributed to incredibly low price tags. Even now, Meritage sells its oversized dwellings for about $75 a square foot.

The company’s counter-intuitive move boosted sales dramatically at a time when closings were scarce. It also started a trend among competing homebuilders that continues today.

“There’s a high demand for large square footage for several reasons,” says Cara Kane, KB Home’s spokesperson. “One is the tremendous value per square foot. The homebuyer sees the benefit of getting a larger home for minimal monthly payment difference.”

The percentage of KB homes sized in excess of 2,200 square feet increased by more than 20 percent between 2012 and 2013, Kane says.

In fact, KB recently built a 4,278-square-foot showcase home in Orlando’s Mabel Bridge community that sold before it was even finished. Then it started a 3,787-square-foot home that also sold while still under construction.

The big house trend started in — wouldn’t you know it? — Texas, says Jeff Menzel, vice president of sales and marketing for Taylor Morrison’s North Florida division. Now Taylor Morrison has jumped on the bandwagon with its Grand and Estate collections.

The company has four Central Florida neighborhoods in which it offers homes topping out between 4,000 and nearly 6,000 square feet

“We saw how larger homes were becoming more and more popular,” says Menzel. “So we figured out how a Taylor Morrison home would look in that size.”

Homebuyers with large families — particularly those encompassing multiple generations including grandparents as well aschildren who boomeranged back home — are obviously an ideal market. But they aren’t the only ones.

“We had an active-adult couple with no children at home, and they bought one of our Grand collection two-story homes,” says Menzel. “They just couldn’t get over what an amazing deal [per square foot] it offered.”

Then there are buyers who just enjoy having extra room. For a small family, the extra bedrooms often become studies so couples can each have their own office space. They’re also adapted for workout rooms and media rooms.

Many large floorplans offer the flexibility of having a master suite upstairs and/or downstairs. The downstairs master suite allows older owners to minimizing stair climbing and parents of teenagers some separation from their messy offspring.

Upstairs master suites mean parents with small children enjoy — well, perhaps “enjoy” is too strong a word —the convenience of being on the same level as their youngsters for nighttime care.

The big-house portion of Taylor Morrison’s offerings in Orlando has grown to about 25 percent after just two years. Its most popular model is the two-story Beaumont, with 4,180 square feet, six bedrooms, three-and-a-half bathrooms and a three-car garage. Buyers can customize the plan by turning two upstairs bedrooms into a second master suite or combining an upstairs bedroom and media room into a larger bedroom.

Many buyers might worry that such large homes, even if they’re inexpensive to buy, will cost more to operate. However, builders say, new homes are so much more energy efficient than those built even 10 years ago that utilities bills generally aren’t any higher than those in smaller, older homes.

Richmond American Homes has always built bigger, with its offerings averaging north of 3,000 square feet, says Doug Moran, the company’s Florida area president. However, recently Richmond American’s average home size has crept up closer to 4,000 square feet, he adds.

“The rates are still low and there’s such a high level of affordability that some people go for the value component and move from 3,000 to 4,000 square feet,” Moran says.

In Orlando, a bestselling model for Richmond American is the Heidi in Bella Lago in Clermont. It boasts 4,279 square feet, four bedrooms, three-and-a-half bathrooms and a three-car garage.

The demand for bigger homes was so apparent that the company has expanded some of its plans into the 4,500-square-foot range, with some more than 5,000 square feet. It plans to do the same in Jacksonville, where it’s looking for land with larger lots for the bigger product.

“If it’s your desire to go bigger, it doesn’t get better than now,” says Moran.

Royal Oak Homes, an Orlando-based builder, has been successfully selling large homes on 50-foot lots in some of its neighborhoods, says Stephen W. Orosz, co-president of the company.

For example, its Parker model can range in size from 4,739 to 5,411 square feet and from five to seven bedrooms. The base price is $374,999, or about $79 a square foot.

Many of Royal Oak’s customers are opting to trick out their big-box homes as well, adding between $30,000 and $40,000, in options, Orosz says.

David Weekley Homes has steadily ratcheted up the size of its homes as well, even in some communities, such as Laureate Park in Lake Nona, where the lots are relatively small.

There the builder is catering to the multi-generational trend by adding “granny” suites to the back of some homes, typicallyapartments over the detached garage, says Steve Ebensberger, area vice president for Weekley.

“We weren’t building them before because there wasn’t the demand,” says Ebensberger. “It’s all these forces that have aligned.” Those forces, he adds, include lower interest rates and rising values for resales, which means relocators can sell their homes for more and spend more on something new.

“Families who have been on the sidelines for a number of years can get out of their homes again because they are not so upside-down,” Ebensberger says.

These buyers often want more than space in their homes as well as plenty of upgrades. Responding to that demand, Weekley, is offering interior bells and whistles that go well beyond basic.

Not surprisingly, Weekley isn’t the only builder adding fancy touches to its big homes. Meritage has been quietly adding extras to its formerly basic offerings as well.

“There’s a demand for more amenities,” says Kittle. “We offer highly designed kitchens with ornate cabinetry, higher ceilings, expansive sliders [glass doors], summer kitchens, larger pools, very highly detailed master baths, every option under the sun.”

SIZE OF NEW HOMES CONTINUES TO EDGE UP

According to recently released data from the Survey of Construction, the trend toward smaller home sizes, which started during the market downturn, has since reversed itself.

In fact, since 2009, the median size of newly started single-family homes has increased steadily, to a record high of more than 2,300 square feet last year.

The survey is conducted by the U.S. Census Bureau, partly funded by HUD, and the source of the familiar monthly series on housing starts. 

In addition to increased square footage, several other new-home characteristics have shown an upward trend from 2009 through 2012, the latest year for which figures are available. 

For example, the average number of bathrooms in new single-family homes rose to a new high of 2.56 in 2012 following a period during which it edged down to as low as 2.20 in 2009. 

The average number of bedrooms in newly started homes also declined during the downturn, but has since very gradually increased.

The pattern of temporary decline in home size during a downturn followed by recovery and resumption of an upward trend has happened before ­— the last time corresponding with the recession and recovery of the early 1980s. 

Many experts thought that the decline in the 2000s was due to factors that would prove to be more permanent, such as desire to keep energy costs down.

Although many buyers are choosing smaller homes for a variety of reasons, energy efficient technology has advanced to the point where operation cost isn’t as dramatically impacted by square footage.