Homebuyers, including those in Las Vegas, continue to seek out smaller homes and more affordable homes and builders continue to move in that direction to meet their preferences.
The median home size dropped from 2,200 square feet in 2023 to 2,150 square feet in 2024 — the lowest in 15 years — after holding strong at 2,300 square feet from 2019 to 2022, according to Rose Quint, assistant vice president of survey research for the National Association of Home Builders who spoke at the International Builders Show in Las Vegas.
The same thing is happening to median lot sizes, which have dropped about 1,000 square feet in the last 15 years to 8,400 square feet, Quint said. In 2007, it was 9,460 square feet, she noted.
As evidence of that nationally, townhomes are also becoming increasingly popular, comprising a record 17 percent of the single-family market compared to 10 percent in 2009. In Las Vegas, townhome sales rose 16 percent in 2024, compared to only rising year-over-year by 9.8 percent for single-family homes. In market share, Las Vegas closed the year in December with a year-high 28 percent of sales being townhomes, far surpassing the national average.
“There’s a simple reason this is happening: Townhomes are more affordable as material, lot and labor prices continue to increase,” Quint said in also highlighting elevated interest rates for dampening affordability. “Townhomes also offer higher density for builders. The trend of homes shrinking will continue in 2025.”
Builders are increasing overall living space by adding on more porches and patios, with a record 68 percent and 64 percent of new homes, respectively, incorporating these features, Quint said. That has long been a trend in Las Vegas to take advantage of the weather.
In addition to building smaller homes, builders are also trying to address affordability concerns by offering sales incentives (64 percent) and cutting home prices (33 percent), Quint said.
Although home size preferences in general are trending smaller, exact sizes differ by generation, Quint said. Millennials prefer larger homes, with a median of 2,408 square feet, while baby boomers are looking to downsize to an average of 1,869 square feet. Both Gen X and Gen Z are looking for homes around 2,250 square feet, she noted.
“Each generation is progressively more open to having a smaller home with higher-quality products and amenities versus a larger home with fewer amenities,” Quint said.
More than half of Gen Z (53 percent) and millennials (52 percent) are willing to make that compromise, with that percentage increasing to 61 percent for Gen X and 70 percent for boomers, Quint said. The same trend is true for incentivizing each generation to purchase a townhome of similar size and quality instead of a single-family home, with Gen Z looking for a 20 percent discount while baby boomers would need a discount of at least 30 percent, she said.
Consistently popular features such as the great room, laundry room and garage storage remain important for most buyers of all generations. Other top amenities and design options include: drinking water filtration; special storage racks for wine/spices in the kitchen; both a shower stall and a tub in the primary bath; and pull-out shelves in the kitchen.
“We asked what area of the home are buyers most willing to pay for upgrades,” Qunit said. “By far, No. 1 is the kitchen. They will pay for upgraded appliances, upgraded countertop, and upgraded cabinets. The second area they will pay to upgrade is the primary bathroom. They want that luxury feeling.”
A great room is the No. 1 feature builders said will include in homes in 2025 at 89 percent. That’s followed by 88 percent saying there will be a walk-in closet in the bedroom, 85 percent citing a 9-foot ceiling on the first floor, and 84 percent citing a central island in the kitchen, and 72 percent saying a walk-in pantry will be included. Builders are less likely to include a separate living room and pet-washing station.
“At best 10 percent of builders are adding those features,” Quint said. “It’s very unlikely to come to the standard home in 2025.”
Certain preferences are common across all generations because they just make sense, Quint said. Top technology features for all homebuyers, for example, include security cameras, wireless security systems and video doorbells — highlighting a key interest in safety.
There’s no major consensus among generations, however, for exterior styles, with Gen Z and millennials leaning slightly more contemporary and Gen X and boomers preferring more traditional home styles, Quint said.
“Builders and designers are adapting to this plurality with a midcentury modern or retro revival style — mixing clean lines with warm textures and accents,” Quint said. “Builders can find simple solutions, such as gable windows or mixed materials, to scale these trends down to an affordable scale.”
Flexibility is also key for homebuyers. Whether it’s designing for longevity and addressing different life stages at the onset or creating spaces that can be used for a variety of wellness activities or increased connection to nature, today’s homes need to reflect their owners and provide them a place to rejuvenate, according to Doug Cummins, senior associate and project manager at DAHLIN Group Architecture and Planning.
“People are being less influenced by influencers,” Cummins said. “Buyers are becoming more sophisticated in what they want to see in their home and make it personal to them. A really simple idea can turn that house into a home for that homebuyer. It makes them feel more connected to the space that they have.”
Buyers want cozy and intimate gathering spaces to relax and read a book or drink coffee or a cocktail, Cummins said. A sitting area with a fireplace inside a bedroom doesn’t take up a lot of space but can be a refuge at the end of the day.
