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Here’s Why Tariffs Benefit McMansions

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The Rise and Endurance of McMansions in the American Housing Market

The 1980s gave birth to a distinctive type of residential architecture known as “McMansions.” These homes often elicit mixed reactions, facing criticism regarding their scale, construction quality, and overall architectural integrity. Despite their sometimes ostentatious appearances, they have gained a reputation as less than ideal investments.

According to Kate Wagner, an architecture critic for The Nation and founder of the blog McMansion Hell, many McMansions are constructed with inexpensive materials such as stucco, faux stone, and vinyl siding. This trend is partly driven by the desire to incorporate numerous amenities and an abundance of living space.

Wagner notes, “These homes often feature movie theaters, expansive great rooms, and various entertainment areas, which embody the modern aspiration for the ideal home.” Despite the criticisms, the allure of larger homes remains strong among U.S. buyers, who continue to purchase McMansions.

“Typically, buying a home is a sound investment,” stated Joel Berner, a senior economist at Realtor.com. “Even if the home leans towards the tacky side, it often provides valuable space for families to grow.”

Data from the U.S. Census Bureau indicates a trend towards larger homes over the last few decades, even as family sizes have tended to shrink. For instance, the median size of a new single-family home in the U.S. grew from 1,900 square feet in 1993 to 2,286 square feet in 2023, while the average family size dropped from 2.61 to 2.51 during the same period.

Despite the ongoing demand for larger living spaces, the U.S. housing market has faced a significant supply shortage since the 2007 housing crisis and the subsequent Great Recession. As reported by Realtor.com, this supply gap, which measures the shortfall between new homes built and new households formed, has reached approximately 3.8 million as of 2024.

Furthermore, the Department of Housing and Urban Development indicates that the construction of both single-family and multifamily homes has yet to rebound to levels seen before the Great Recession.

Challenges such as rising construction costs, compounded by possible tariffs on materials like steel and aluminum, have intensified the situation, according to the National Association of Home Builders.

As a result, McMansions have become increasingly attractive to first-time homebuyers seeking affordable properties that still offer ample space. Berner highlights that limited housing options further fuel the appeal of these larger homes, particularly in suburban areas that border major metropolitan regions, such as Bergen County, New Jersey, situated just outside New York City.

“These types of houses dominate my sales; I recently engaged in a bidding war over one,” remarked Melissa Rubenstein, a real estate sales associate with Corcoran Infinity Properties in Ridgewood, New Jersey.

For more insights into this evolving housing trend, watch the attached video.

Source
www.cnbc.com

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