[pchristensen]

I don't know about MN specifically, but the teardown+upsizing is usually a direct result of zoning restricting multifamily development. A 4500sf lot could hold 3-4 townhomes that probably cost similar to the sale price of that 1200sf bungalow, and together sell for more than your quasi-mcmansion. If you need a variance to build the townhomes but can build the McMansion by right, that changes the economics of time and certainty, so you end up with the McMansion. I just moved out of Bellevue, WA and that city is full of run down houses from the 50s getting town down for 4500sf $1.5M+ mansions. In general, the #invisiblehand has his thumb on the scales against legal, by-right development of denser housing.

[beat]

I don't think a 4 unit townhome is practical on these small lots with alley garages. Townhome construction around here is a burbs thing, and done in large clumps of 2-10 city blocks or so of area (and which tend to be singularly unattractive and gross).

I don't think it's just zoning here. There have been some small multi-family units built. But they don't sell all that well or seem economically attractive to builders.

And back to my point... I think there's a lot of sort of theoretical macroeconomic handwaving going on when it comes to housing density that flatly rejects engaging with real world conditions in any way. It sounds smart, but it's dumb.

[pchristensen]

Again, not sure about that local market, but modern townhomes of 1500-1800sf on a ~1000sf lot is a very common form. Alley garages make it even easier because then the front can look nice instead of being 75% driveway and garage.