By: Roshawn Watson
Your house is about 6,000 square feet, almost triple the size of the national average. It has five bedrooms and bathrooms, two-story entryway, three-car garages, master suites with sitting areas and whirlpool tubs. With a crib like this, how could anyone not be impressed? Well, many aren't. There is a growing backlash for homes that fit the aforementioned description, commonly called McMansions.
What is the Problem
Detractors have called these homes "garage mahals," "faux chateaux", "tract castles," "hummer houses," and "starter castles." Although these homes boast of many nice features, many of these homes and their features look and feel out of place because they are characterized by sprawling layouts on small lots and poor craftmanship and materials..
According to Wikipedia: They're tacky, they lack a definitive style and they have a "displeasingly jumbled appearance."
Amongst the biggest critics are longtime residents of the neighborhoods populated by McMansions. Often they fear that the McMansions are out of character with their neighborhoods. Additionally, these homes also quickly raise property values and tax rates. During a time of budget shortfalls, more tax money to a small town that doesn't have much of a commercial tax base and higher property values may appear good, but many longtime residents simply cannot afford the changes. Some of these longtime residents have formally mobilized, raising complaints to their local government. As a result, many "light and view blocking" ordinances have been passed including: moratoriums on McMansions (Atlanta, GA), home and footprint size limits (Arlington County, VA and Wood-Ridge, N.J.), big-and-tall ordinances for homes greater than 4,000 square feet or over 30 feet high (Marin County, CA), and several other special procedures and requirements for larger homes.
Another challenge these McMansions have faced is luring in buyers. "McMansions just look and feel out of place today, given the more cautious environment everyone is living in," said Paul Bishop, vice president of research for the National Association of Realtors (per CNBC). For example, consider that the heating and cooling costs could easily raise your energy bill to $5,000 a year or more for a 5,000-square-foot house. Some homes will set you back $1,000-a-month for utility bills and $25,000 in annual taxes. Consequently, some owners of McMansions have questioned their initial logic in making such purchases for numerous reasons including: poor quality of materials and craftsmanship and high expenses. Some are down-sizing the space while upgrading for higher-quality construction and better features. Having less space often means having less of a cleaning, maintenance, and financial burden. The rationale is "why keep a room that is never in use?" Other couples have are selling simply because their families or budgets are smaller. Of course, McMansions hefty price tags certainly deter potential buyers as well.
How Did We Get Here
The primary cause of the McMansion glut is: speculation. We have discussed it before. Many people erroneously thought of their homes as assets. Thus, if homes are assets, it only makes sense to get as much of that asset as possible. Hence, several people were using their homes to speculate in the real estate market. After all, people thought home prices would only go up. Consider it this way, if you ask a banker to give you a loan to purchase stock, they will kick you out on your butt. However, this is certainly not the case if you ask for a mortgage, provided that you meet the lender standards. Thus, some people were thinking of their homes as part of their retirement portfolios.
Another cause of the McMansion glut is the overall trend of the American home size increasing. Back in 1950, the average home in America was 983 square feet. However, in 2004, the average home size had swelled to 2349 square feet (140% increase). Specifically, the modern mega-house trend has been about a 20-year trend according to Robert Lang, director of the Metropolitan Institute (per MSN). However, after years of growth, it appears that this trend has officially changed. A recent survey of builders in 2009 indicated that nine out of 10 said they planned to build smaller or lower-priced homes (per CNBC). Additionally, the Census Bureau reported that the median new home size fell to 2,135 square feet in 2009 after peaking at more than 2300 earlier in the 2000s. (per CNN money). Moreover, many real-estate experts say they think this trend of downsizing, or "right-sizing," is here to stay. The rationale is if families had to downside or "right-size" because they were financially over-extended, such as due to foreclosure or bankruptcy, they will be generational imprinted with this negative experience and will not repeat this mistake. However, this principle seems to be more theory than actuality because history tends to repeat itself continually.
Only, time will tell whether the death blow has truly been dealt to the "garage mahals" after all.
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Here's a question for you: Why would or wouldn't you purchase a McMansion? Do you feel they are gone forever or are they just in a cyclical trend?
