[throwaway2016a]

I hear this all the time but it doesn't make much sense, IMO. Buyers do not control the square footage of inventory and for the most part are not looking for a huge house.

"The house I just bought is 4k square feet because I demanded a huge house" is very different than "The house is 4k square feet because it was one of only 3 houses put on the market this month and it was either this or no house at all."

So, while yes, it is probably true that a lot of houses on the market are probably generally larger, I'm not sure that matters for this debate unless the buyers are actually demanding that (which in my experience, they are not).

"But your houses is bigger" is no consolation when you didn't want a big house to begin with. It's a signal what the builders are building and zoning laws allow is completely out of touch with what people actually want. Yes, demand drives up cost but the demand is there because people want housing and the only houses available are huge not because they are looking for huge houses.

[xnx]

> Buyers do not control the square footage of inventory and for the most part are not looking for a huge house.

Collectively, over time, buyers' preferences are manifested in the housing stock. Same as with cars getting bigger.

[throwaway2016a]

I know in theory that is how it should work but is there a study to back that up?

The thing is, in my estimation, in most places the demand is so high that whatever makes the builders the most is what will get made. Which isn't necessarily what the majority of the market demands. Builders profit more off high square footage and buyers -- desperate for just someplace to live that's not the rental market -- will snatch it up. A 4 bedroom house in my market (granted one of the hottest housing markets in the US) is usually gone just days after listing.

Or, to use an analogy, if you open a water stand in the desert and sell flavored water for $5, it doesn't matter if the buyer really wanted plain water for $1, they are still going to buy your water since it is the only water available. And why start offering plain water when the flavored one sells out instantly and makes more profit?

[bennyhill]

Its also not buyer and future occupants that determine (new) house sizes. Local government in many places uses zoning to make sure new dwelings bring more tax income than school age children costs.

[throwaway2016a]

Yes, absolutely. I did mention zoning in my message, which definitely plays a big role. Not just property tax related but also a lot of existing property don't want high density housing in their back yard.