For today’s new homebuyers, the question isn’t how big can we build? It’s how much home do we really need?
As affordability, interest rates, and energy costs reshape buying decisions, many shoppers are choosing smaller, smarter homes that deliver better design, lower operating costs, and stronger lifestyle alignment.
Right-Sizing the American Home
For years, new homes trended larger – often exceeding what households actually used. At the other extreme, the tiny house movement (homes under 400 square feet) showed how little space people can live with.
Most buyers now fall in between, gravitating toward right-sized homes that emphasize function over square footage.
The “Not So Big” Movement
Architect and author Sarah Susanka, creator of the Not So Big House philosophy, helped spark this shift by encouraging buyers to focus on quality, not size.
“People would come into my office asking first of all for a size… I knew if they wanted 3,000 square feet, it would be absolutely bare bones.”
Her solution: design homes around how people actually live, allowing budgets to go toward better materials, thoughtful layouts, and lasting appeal.
Small Homes, Designed With Dignity
After Hurricane Katrina, designer Marianne Cusato applied these ideas to the Katrina Cottage – compact, affordable homes that were livable, expandable, and well-designed.
The concept resonated beyond disaster housing, reinforcing that home decisions should be based on daily life patterns, not just location.
“It’s proximity… where that place is in connection with the things you need and want to do in a day.”
Built for Real Life
Homeowners Rob and Linda Mahan put the philosophy into practice with a 1,600-square-foot, energy-efficient new home designed around their routines – not tradition.
“We have a kitchen and what you would call a living room… basically all one space.”
The open layout eliminated unused rooms while preserving flexibility for entertaining.
Julie Hulme and Rob Handy went even smaller, building an 825-square-foot home that blurs the line between indoors and out.
“We spend a lot of time outside, so we wanted a home interfacing directly with our garden.”
Smart design reduced clutter, improved comfort, and made the home feel larger than its footprint.
Why New Construction Buyers Are Choosing Smaller Homes
| Key Factor | What It Means |
|---|---|
| Affordability | Smaller homes reduce construction, financing, and long-term ownership costs |
| Energy efficiency | Less space to heat and cool makes sustainability more achievable |
| Better finishes | Budgets stretch further with premium materials and upgrades |
| Lifestyle fit | Homes are designed around real routines, not resale assumptions |
Today’s builders increasingly offer smaller floor plans with luxury options, patio homes, cottages, and townhomes that reflect these priorities.
Design Matters More When You Build Small
A compact home leaves little room for wasted space – or poor planning. Choosing an architect or builder who understands lifestyle-driven design is critical.
“We had energy goals, lifestyle goals and entertainment goals,” says Linda Mahan. “You can frame those decisions around that.”
| Key strategies include: | |
|---|---|
| Built-in storage and cabinetry | Open kitchens with multifunctional islands |
| Flexible rooms instead of formal spaces | Seamless indoor-outdoor connections |
The Only Downside?
“The one downside to building a house like this,” Rob Mahan says, “is that it really makes it hard to go on vacation.”
When a home fits your life perfectly, you may not want to leave it. Let NewHomeSource narrow your search for the right size new construction home and location.
Julie Gordey
A lifelong educator, Julie Gordey, is a retired school administrator. After years of focusing on education, this University of Texas graduate now travels and enjoys freelance writing for BDX and NewHomeSource.com.